Appendix — Sonneberg v. United States

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APPENDIX A — OPINION OF THE UNITED STATES

COURT OF APPEALS FOR THE THIRD CIRCUIT

FILED APRIL 4, 2003

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 01-2607

MILTON SONNEBERG,

Appellant

v.

UNITED STATES OF AMERICA

On appeal from the United States District Court

for the District of New Jersey

District Court Judge: The Honorable Nicholas H Politan

(D.C. Civil No. 00-cv-1000)

Submitted Under Third Circuit L.A.R. 34.1(a)

January 14, 3003

Before: ROTH, FUENTES, Circuit Judges,

and ALDISERT, Senior Circuit Judge

(Opinion Filed: April 4, 2003)

OPINION OF THE COURT: FUENTES, Circuit Judge

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Appendix A

Milton Sonneberg appeals the District Court’s denial of

his petition for collateral relief pursuant to 28 U.S.C. § 2255.

Sonneberg was convicted of conspiracy to commit wire fraud

and mail fraud, wire fraud and multiple counts of each of

mail fraud and interstate transportation of money obtained

through fraud. Sonneberg contends in his Section 2255

petition that the Supreme Court’s decision in Neder v. United

States, 527 U.S. 1 (1999), is an “intervening change in the

law” that establishes that he has been convicted for offense

conduct that is not a crime. We disagree. For the reasons

that follow, we will affirm the District Court’s denial of

Sonneberg’s Section 2255 petition.

I. BACKGROUND

Sonneberg was indicted by a federal grand jury on

April 23, 1995, along with Irwin H. Block (sic) (a/k/a

“Sonny Bloch”), James Barschow , Joseph Glenski, and

Bruce Schroeder. Sonny Bloch pleaded guilty to eight of the

thirty-five counts in the indictment on September 18, 1996.

A federal grand jury returned a thirty-count superceding

indictment against the remaining four defendants on

December 18, 1996. Barschow, Glenski and Schroeder

pleaded guilty to nine counts on April 9, 1997. Another thirty-

count superceding indictment was filed against Sonneberg

on April 23, 1997. In that indictment, Sonneberg was

charged with the following offenses: (1) conspiracy to

commit wire fraud and interstate transportation of money

obtained through fraud in violation of 18 U.S.C. § 371;

(2) conspiracy to commit mail fraud and interstate

transportation of money obtained through fraud in violation

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of 18 U.S.C. § 371; (3) wire fraud in violation of 18 U.S.C.

§ 1343; (4) four counts of mail fraud in violation of 18 U.S.C.

§ 1341.

A trial commenced on May 1, 1997. In brief, the facts

established at trial show that Sonneberg, Bloch, Barschow,

Glenski and Schroeder conspired to market limited liability

company (“LLC”) interests in a series of wireless cable

television ventures and in a proposed radio-station network.

The conspirators’ sales pitches promised potential investors

unparalleled opportunities in the cutting-edge technology of

wireless cable television systems and a network of

independent broadcasters owned by “Bloch Broadcasting.”

The problem with the sales pitches was there were no viable

business ventures behind them. In fact, the wireless cable

systems being promoted did not have any of the resources,

such as profitable channels, sites and FCC licenses , necessary

to make them operable, much less profitable. And “Bloch

Broadcasting” was a shell company with no assets.

Nonetheless, the promoters raised millions of dollars from

investors. Approximately forty percent of the investor money

was paid to the conspirator-promoters in the form of sales

commissions.

Sonny Bloch touted the sale of the LLCs on his

nationally-syndicated radio program, “The Sonny Bloch

Radio Show.” Bloch had 1.5 million listeners and a good

reputation as a consumer advocate. He agreed to endorse the

sale of the LLCs and to vouch for the character of the

promoters and the financial soundness of the ventures on his

radio program. Despite the fact that Bloch was paid $2000

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per week for these endorsements, he made them sound

personal rather than commercial]. The conspirators used

Bloch’s radio program to develop leads to market the LLCs.

The conspirators also developed sales brochures for each

of the LLCs they were promoting. The brochures included

inflated financial projections and promised unrealistically

high returns. The brochures misrepresented the true identity

of the principals in the ventures, how the investment money

would be allocated, the claims regarding the subscribership

base for the ventures, and the ability of investors to participate

in management decisions. The brochures also failed to

disclose the prior criminal convictions and civil fraud

injunctions against certain of the conspirators, including

Sonneberg.

On May 29, 1997, Sonneberg was convicted of all thirty

counts alleged in the indictment. The District Court sentenced

him to a 76 month prison term and ordered him to pay $5.2

million in restitution. Sonneberg appealed his conviction and

sentence. On August 12, 1998, this court affirmed his

conviction and sentence by judgment order. United States

v. Sonneberg, 164 F.3d 621 (3d Cir. 1998) (unpublished,

non-precedential opinion). The Supreme Court denied his

petition for certiorari on March 5, 1999.

On March 1, 2000, Sonneberg filed a petition for

collateral relief pursuant to 28 U.S.C. § 2255. While that

petition was pending in the District Court, Sonneberg filed a

petition for a writ of mandamus, which this Court denied on

March 20, 2001. On April 6, 2001, the District Court denied

his Section 2255 petition and denied him a certificate of

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Appendix A

appealability. The District Court denied Sonneberg’s motion

to reconsider.

On May 2, 2001, Sonneberg filed a timely notice of

appeal and a request for a certificate of appealability from

this Court. By order dated June 18, 2002, this Court granted

Sonneberg a certificate of appealability limited to two of his

claims: (1) that the District Court failed to instruct the jury

on an element of the offense; and (2) that the government

used an untenable theory of materiality, resulting in a

conviction for offense conduct that is not a crime.

Il. ANALYSIS

The District Court had jurisdiction over Sonneberg’s

petition for collateral relief pursuant to 28 U.S.C. § 2255.

We have jurisdiction over his appeal pursuant to 28 U.S.C.

§ 2255, 1291. We have plenary review over the

District Court’s denial of Sonneberg’s Section 2255 petition.

United States v. Lloyd, 188 F.3d 184, 186 (3d Cir. 1999).

28 U.S.C. § 2255 provides in pertinent part:

A prisoner in custody under sentence of a court

established by Act of Congress claiming the right

to be released upon the ground that the sentence

was imposed in violation of the Constitution or

laws of the United States, or that the court was

without jurisdiction to impose such sentence, or

that the sentence was in excess of the maximum

authorized by law, or is otherwise subject to

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collateral attack, may move the court which

imposed the sentence to vacate, set aside, or

correct the sentence.

It is well settled that a petitioner generally may not

relitigate issues that were decided adversely to him on direct

appeal by means of a Section 2255 petition. See United

States v. DeRewal, 10 F.3d 100, 105 n.4 (3d Cir. 1994).

An exception exists, however, when there has been an

“intervening change in the law” affecting the claim previously

decided adversely to the petitioner. See Davis v. United

States, 417 U.S. 333 (1974).

The certificate of appealability sets forth two claims:

(1) that the District Court failed to instruct the jury on an

element of the offense; and (2) that the government used an

untenable theory of materiality, resulting in a conviction for

offense conduct that is not a crime. As Sonneberg’s brief

makes clear, these two claims collapse into one argument

that, prior to finding liability for mail and wire fraud on the

basis of a material non-disclosure, a jury must first find that

the defendant was under a duty to disclose, and that, in this

case, the District Court erred in failing to instruct the jury on

this element of the offense.

This claim was previously litigated on direct appeal.

The first issue raised in Sonneberg’s opening brief on direct

appeal is “The Jury Was Improperly Permitted to Convict

on the Basis of Nondisclosures.” (Supp. App. at p. 9)

The arguments he made in support of the asserted error were

as follows: (1) the mail and wire fraud statutes require a duty

to disclose before imposing liability for a material omission;

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Appendix A

(2) because he had no duty to disclose his prior guilty plea

and civil injunction, he was convicted on a legally insufficient

theory; (3) the jury was never instructed that it had to find

that he had a legal duty to disclose; and (4) reversal is required

because the jury was permitted to find guilt on legally

impermissible and unconstitutional theory. Id. at 9-10. After

considering Sonneberg’s arguments, this Court affirmed his

conviction and sentence. United States v. Sonneberg,

164 F.3d 621 (3d Cir. 1998) (unpublished, non-precedential

opinion). Thus, this Court has already considered the central

argument raised by Sonneberg in his Section 2255 petition

namely, that the duty to disclose is a required element of the

offenses of mail and wire fraud.

Despite the fact that we have already decided this issue

adversely to Sonneberg, he urges us to reconsider it in light

of Neder v. United States, 527 U.S. 1 (1999), which he

asserts is an “intervening change in law.” We do not agree

that Neder is an intervening change in the law warranting

relitigation of the issue already decided on direct appeal.

First, Neder is not a “change in law” because the two holdings

of Neder do not pertain to the issue raised by Sonneberg.

In fact, Neder did not change the state of the law pertaining

to whether a duty to disclose is an element of the offenses of

mail and wire fraud. And second, Neder is not an intervening

decision.

In Neder, the defendant had been “tried on charges of

violating a number of federal criminal statutes penalizing

fraud.” 527 U.S. at 4. The government conceded that the

district court erred in refusing to submit the issue of

materiality to the jury with respect to the tax fraud charges.

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Id. The Supreme Court held that an instruction that omits an

element of the offense, such as the instruction on tax fraud,

does not necessarily render a criminal trial unfair, and is thus

subject to harmless error analysis. Id. at 4, 9. The Court also

held that “materiality is an element of the federal mail, wire

and bank fraud statutes.” 1d. at 4 (emphasis added).

In this case, the District Court properly instructed the

jury that materiality is an element of the offenses of wire

and mail fraud. (App at pp. 40-471). Sonneberg does not

contest the District Court’s materiality instruction. Instead,

Sonneberg argues that the District Court failed to instruct

the jury that duty to disclose is an element of the offenses in

mail and wire fraud when there is an allegation of a material

non-disclosure. Neither holding of Neder bears on that

argument.

Sonneberg argues, however, that certain language in

Neder supports his argument that the duty to disclose is an

element of mail and wire fraud. Specifically, he points to the

Court’s rejection of the government’s argument that Congress

“chose to unmoor the federal mail fraud statute from its

common-law analogs...’ Neder, 527 U.S. at 24. Based on

this statement, Sonneberg contends that, because duty to

disclose was an element of common-law fraud, it must remain

an element of the federal mail and wire fraud statutes.

Sonneberg overlooks the fact that in determining that the

common-law element of materiality remains an element of

federal mail and wire fraud, the Court observed that

“the fraud statutes did not incorporate all the elements of

common-law fraud.,” including the elements of reliance and

damage. Id. at 24-25 (emphasis in original). Sonneberg also

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Appendix A

disregards the fact that the Court was only considering the

element of materiality in the Neder decision. Thus, the

language cited by Sonneberg is not sufficiently precise to be

an “intervening change in law” warranting relitigation of an

issue previously decided on direct appeal.

Sonneberg also overlooks the substantial precedent

establishing that duty to disclose is not always an element of

common-law fraud when there has been a material non-

disclosure. In a decision post-dating Neder, the Fourth Circuit

recognized that “[t]he Supreme Court has recently articulated

an outer boundary for the interpretation of the federal fraud

statutes,” but nonetheless found that “at common law, no

fiduciary relationship, no statute, no other independent legal

duty to disclose is necessary to make active concealment

actionable fraud - simple ‘good faith’ imposes an obligation

not to purposefully conceal material facts with intent to

deceive.” United States v. Colton, 231 F.3d 890, 899-900

(4 Cir. 2000) (citing Neder, 527, at 1; Strong v. Repide,

213 U.S. 419, 430 (1909); Tyler v. Savage, 143, U.S. 79, 98

(1892); Stewart v. Wyoming Cattle Ranch Co., 128 U.S.

383, 388 (1888)); United States v. Keplinger, 776 F.2d 678,

697-98 (7" Cir. 1985); United States v. Townley, 665 F.2d

579, 585 (5" Cir. 1982); United States v. Allen, 554 F.2d

398, 410 (10" Cir. 1977). Thus it is clear that both before

and after the Neder decision, duty to disclose is not a

required element of the common-law offenses when there

have been material non-disclosures.

Not only is Neder not an (sic) “change in law” with

respect to Sonneberg’s claim, it is also not “intervening.”

Sonneberg’s conviction and sentence were affirmed by this

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Court on August 12, 1998. He petitioned to the Supreme

Court for certiorari, and raised the issue of whether

‘a defendant may be convicted under the federal mail and

wire fraud statutes for failing to disclose certain information

despite having no duty to disclose that information.”

(Supp. App. At p. 232). Sonneberg’s petition for certiorari

was pending when the Court decided Neder. In fact, Neder

was decided on February 23, 1999, and the Court denied

Sonneberg’s petition on March 5, 1999. Because

Sonneberg’s petition was not final until his petition for

certiorari was denied, see Kapral v. United States, 166 F.3d

565, 570 (3d Cir. 1999), the Neder decision was not

“intervening.” Moreover, because Sonneberg’s petition was

still pending when Neder was decided, if the Court thought

that Neder was relevant to Sonneberg’s claims, the Court

could have remanded his case for further proceedings.

Instead the Court simply denied Sonneberg’s petition.

In sum, because Sonneberg has not established an

“intervening change in law” he is not entitled to relitigate

the claim decided adversely to him on direct appeal.

Accordingly, we will affirm the District Court’s denial of

Sonneberg’s Section 2255 petition.

TO THE CLERK OF THE COURT

Kindly file the foregoing Opinion

/s/

Julio M. Fuentes

Circuit Judge

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APPENDIX B — LETTER OPINION OF THE UNITED

STATES DISTRICT COURT FOR THE DISTRICT

OF NEW JERSEY DATED APRIL 6, 2001

UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

CHAMBERS OF

NICHOLAS H. POLITAN

JUDGE

April 6, 2001

LETTER OPINION

ORIGINAL ON FILE WITH

CLERK OF THE COURT

Mr. Milton Sonneberg

Reg. No. 20869-050

P.O. Box 1000

Fort Dix, NJ 08640

Petitioner Pro Se

Alain Leibman, Assistant

U.S. Attorney

ROBERT J. CLEARY, UNITED STATES ATTORNEY

970 Broad Street

Newark, NJ 07102

Attorney for Respondent

Re: Milton Sonneberg v. United States

Civil Action No. 00-1000 (NHP)

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Dear Litigants:

This matter comes before the Court on the petition of

Milton Sonneberg to vacate, set aside or correct a sentence

pursuant to 28 U.S.C. 2255. This matter was resolved without

oral argument pursuant to Fed.R.Civ.P. 78. The Court has

reviewed the written submissions of the parties and, for the

reasons explained herein, the petition of Milton Sonneberg

to vacate, set aside, or correct the sentence is DENIED and

DISMISSED. No certificate of appealability shall issue.

This case is now CLOSED.

BACKGROUND

Petitioner, Milton Sonneberg (“petitioner”), acting

pro se, brings this civil action pursuant to 28 U.S.C. § 2255

to vacate, set aside or correct the sentence, or in the

alternative, to remand for an evidentiary hearing.

The facts of this case are fairly straightforward. Petitioner

was indicted by a federal grand jury on April 23, 1995, along

with four other individuals: Irwin H. Block (sic), a/k/a “Sonny

Block,” James Barschow, Joseph Glenski, and Bruce

Schroeder. Sonny Bloch pled guilty to eight counts in the

thirty-five count indictment on September 18, 1996.

A federal grand jury returned a thirty-count superseding

indictment against the remaining defendants on December

18, 1996. A trial was scheduled to begin on April 7, 1997.

On April 9, 1997 Glenski, Schroeder, and Barschow pled

guilty to nine counts in the superseding indictment.

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A thirty-count second superseding indictment was filed

against petitioner on April 23, 1997. This indictment charged

petitioner with the following offenses: conspiracy to commit

wire fraud and interstate transportation of money obtained

through fraud in violation of 18 U.S.C. § 371; conspiracy to

commit mail fraud and interstate transportation of money

through fraud in violation of 18 U.S.C. § 371; wire fraud in

violation of 18 U.S.C. § 1343; twenty-three counts of

interstate transportation of money obtained through fraud in

violation of 18 U.S.C. § 2314; and four counts of mail fraud

in violation of 18 U.S.C. § 1341.

A trial commenced on May 1, 1997, and petitioner was

convicted of all thirty counts on May 29; 1997. This Court

sentenced petitioner on December 16, 1997, to a seventy-six

month term of imprisonment, followed by five years of

supervised release. Petitioner was also ordered to pay %5.2

million in restitution. Final judgment was entered on

January 9, 1998.

Petitioner filed a notice of appeal from his conviction.

On August 12, 1998, the Court of Appeals for the

Third Circuit affirmed petitioner’s conviction. The United

States Supreme Court denied his petition for certiorari on

March 5, 1998.

Petitioner filed the instant petition on March 1, 2000.

He filed a writ of mandamus with the Court of Appeals for

the Third Circuit on August 13, 2000. That court denied

petitioner’s writ of mandamus on March 20, 2001. In his

petition, petitioner claims several errors occurred at trial,

including the following: (1) the district court failed to instruct

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the jury on an element of the offense; (2) the government

used an untenable theory of materiality; (3) ineffective

assistance of counsel based on counsel’s (a) permitting the

presentation of false testimony by government; (b) permitting

of inadmissible evidence; c) conflict of interest; and (d)

failure to recognize and defend against the aforementioned

alleged errors.

Discussion

I. Standard of Review

Section 2255 of Title 28 of the United States Code

provides a means of collaterally attacking a sentence imposed

after a conviction. Section 2255 provides, in pertinent part:

A petitioner in custody under the sentence of a

court established by Act of Congress claiming the

right to be released upon the ground that the

sentence was imposed in violation of the

Constitution or laws of the United States, or that

the court was without jurisdiction to impose such

sentence, or that the sentence was in excess of

the maximum authorized by law, or is otherwise

subject to collateral attack, may move the court

which imposed the sentence to vacate, set aside

or correct the sentence. ...

The grounds for collateral attack of a sentence pursuant

to Section 2255 are narrowly limited. See United States v.

Biberfeld, 957 F.2d 98, 102 (3d Cir. 1992). The Third Circuit

has recognized that “not all non-constitutional errors in

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criminal proceedings enable a prisoner to bring an

action under [Section] 2255 for relief.” Diggs v. United

States, 740 F.2d 239, 242 (3d Cir. 1984); accord United States

v. Vancol, 778 F.Supp. 219, 22 (D.Del. 1991), aff'd, 970 F.2d

901 (3d Cir. 1992).

A motion under Section 2255 will be granted “only if

the sentence results in ‘a fundamental defect which inherently

results in a complete miscarriage of justice’ or ‘omission

inconsistent with rudimentary demands of fair procedure.’”’

United States v. Cannistraro, 734. F.Supp. 1110, 1119 (D.N.J.

1990) (quoting Hill v. United States, 368 U.S. 424, 428

(1962)); see also United States v. DeLuca, 889 F.2d 503, 506,

93d. Cir. 19898), cert. denied, 496 U.S. 939 (1990);

Vancol, 778 F.Supp. at 222-23. Similarly, errors of fact will

not provide a basis for relief unless “the errors were of the

most fundamental character, that is, such as rendered the

proceeding itself irregular and invalid.” United States v.

Addonizio, 442 U.S. 178, 185-86 (1979) (quoting United

States v. Mayer, 235 U.S. 55, 69 (1914)).

A petitioner’s failure to raise a particular error either at

trial or on direct appeal generally precludes the assertion of

that error for the first time in a collateral attack under Section

2255. See United States v. Essig, 10 F.3d 968, 979 (3d Cir.

1993); United States v. DeRewal, 10 F.3d 100, 105 n.4

(3d Cir. 1993), cert. denied, 511 U.S. 1033 (1994); United

States v. Oser, 864 F.2d 1056, 1061 (3d Cir. 1988). Where a

Section 2255 motion rests on issues not raised at trial or on

direct appeal, the petitioner bears the burden of demonstrating

both “cause” to excuse the procedural default and that “actual

prejudice” will result from the errors at issue. See United

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Appendix B

States v. Frady, 456 U.S. 152, 167, reh'g denied, 456 U.S.

1001 (1982); Essig, 10 F.3d at 979; DeRewal, 10 F.3d at 105

n.4; Biberfeld, 957 F.2d at 104. “[T]he existence of cause

for procedural default must ordinarily turn on whethersome

objective factor external to the defense impeded counsel’s

effort to comply with the ... procedural rule.” Murray v.

Carrier, 477 U.S. 478, 488 (1986); see also Essig, 10 F.3d

at 979.

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Il. Duty to Disclose

Petitioner claims he was improperly convicted of mail

and wire fraud based upon his failure to disclose to investors

his prior criminal conviction and civil fraud injunction. He

argues that his conviction cannot stand because the law

imposed upon him no duty to disclose such information.

Petitioner's premise is flawed. As respondent correctly points

out, the mail and wire fraud statutes are not limited to

matters which would be punishable as common law fraud.

See Durland v. United States, 161 U.S. 306, 313-14 (1896);

United States v. Moore, 37 F.3d 169, 172-73 (5" Cir 1994);

United States v. Stewart, 872 F.2d 957, 960; United States v.

Bishop, 825 F.2d 1278, 1280 (8" Cir. 1987). “[OJ]missions

or concealment of material information can constitute fraud

... cognizable under the mail fraud statute, without proof of

a duty to disclose the information pursuant to a specific

statute or regulation.” United States v. Keplinger, 776 F.2d

678, 697 (7" Cir. 1985), cert. denied, 476 U.S. 1183 (1986).

Thus, petitioner was not entitled to a duty to disclose

instruction because it is not an essential element of the

offense of mail or wire fraud. See United States v. Maxey,

898 F.2d 148 (4 Cir. 1990). Indeed, as the Fifth Circuit has

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indicated, petitioner’s contention that he had no duty under

the law to disclose his criminal conviction is therefore

“irrelevant” to the question before this Court.’ See Moore,

37 F.3d at 172. Also, the Third Circuit rejected this same

argument in affirming petitioner’s conviction upon direct

review.

In addition, petitioner’s reliance on Chiarella v. United

States, 445 U.S. 222 (1980) is misplaced. Chiarella involved

a defendant’s conviction under Section 10(b) of the Securities

Exchange Act of 1934, 15 U.S.C. 78j(b), and SEC Rule

10b-5; not mail and wire fraud as is the case here. Chiarella

simply is not applicable to this case. As petitioner has not

established a fundamental defect which would inherently

result in a complete miscarriage of justice, his claim on this

basis is denied.

Ill. Improper Jury Charge

Petitioner next contends that the Court improperly

charged the jury regarding the concept of materiality.

This argument is likewise without merit. This Court at trial

1. The Court notes that the indictment charged not only charged

petitioner with failure to disclose his previous criminal conviction

and civil fraud injunction, but also charged petitioner with affirmative

misrepresentations, false and misleading statements and material

omissions of fact made with regard to such as the true identity of the

principals involved in the investment schemes, the uses of the

proceeds, the profits to be made, and the ability of investors to

participate in management decisions. Thus, the jury was not invited

to convict petitioner on the basis of omissions alone; it is quite

possible the jury convicted petitioner on the basis of affirmative

misrepresentation and concealment as well.

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Appendix B

defined materiality in the following manner: “[a] material

fact is a fact that would have a natural tendency to influence ~

or be capable of influencing a person making a decision about

a particular matter of transaction.” This language is virtually

identical to the language consistently used by the Supreme

Court in defining “materiality.” In United States v. Wells, 519

U.S. 482 (1997), the Supreme Court defined materiality as

“hav[ing] a natural tendency to influence or [being] capable

of influencing the decision of the decisionmaking body to

which it was addressed.” See also Kungys v. United States,

485 U.S. 759, 770 (1988). The Third Circuit has expressed a

similar definition of materiality. See In re David Louis Cohn,

54 F.3d 1108, 1114 (3d Cir. 1995); United States v. Greber,

760 F.2d 68, 73 (3d Cir. 1985). The Third Circuit also rejected

this claim upon petitioner’s direct appeal.

In addition, the court instructed the jury that the charged

schemes included both false statements about the details of

the venture, such as the use to be made of the investors’

money , and the failure to disclose material facts about the

investment and petitioner and others involved in the ventures.

Moreover, the Court also instructed the jury that while it was

not required to find that every charged component of the

scheme was proved, it did have to find that “the scheme,

substantially as charged, was set up.” As a result, petitioner’s

reliance on Yates v. United States, 354 U.S. 298 (1957)

is mistaken, since Yates requires reversal only when the jury’s

verdict may have rested on a legally invalid ground and

“it 1s impossible to tell which ground the jury selected.”

354 U.S. 298, 312.

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Appendix B

Here, it is not impossible to discern which ground the

jury selected. It is entirely possible that the jury’s verdict

meant it found that the scheme was set up “substantially as .

charged.” It is unlikely the verdict would have been different

if the single charge of concealment of petitioner’s criminal

conviction and civil injunction had not been included in the

indictment. Even assuming arguendo that the Court

improperly instructed the jury, any error was harmless.

See Neder v. United States, 527 U.S. 1, 6-8 (1999) (“[I]f the

defendant had counsel and was tried by an impartial

adjudicator, there is a strong presumption that any other

constitutiona[1] errors that may have occurred are subject to

harmless-error analysis.”) (quoting Rose v. Clark, 478 USS.

570, 579 (1986)). Moreover, at trial the government presented

substantial and overwhelming evidence that petitioner had

participated in a scheme to defraud by failing to disclose to

the investors that_he had been convicted of conspiracy to

commit securities fraud and permanently enjoined from

selling securities. The government also advance significant

evidence of petitioner’s fraudulent intent and active

participation in the conspiracy. Accordingly, petitioner’s

claims on this basis must be denied.

IV. Perjury

Petitioner also alleges several witnesses and

co-conspirators presented perjured testimony at trial and that

the prosecution know of the perjury but still presented the

witnesses in any event. These instances of perjury, it is .

argued, rose to the level of constitutional violation.

Yet, petitioner proffers on bald, conclusory and self-serving

allegations of perjury. No factual evidence of perjury

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Appendix B

committed by any witness, co-conspirator or co-defendant

is offered by petitioner. Petitioner’s claims based on perjury

must accordingly be denied.

V. Ineffective Assistance of Counsel

Petitioner next argues that his trial counsel was

ineffective because he failed to object to the admissibility of

audio tapes presented by a witness named Lionel Benedict.

Petitioner contends that the government and defense counsel

knew the tapes were inadmissible. His only objection to the

tapes is that they were incomplete. Petitioner asserts that his

trial counsel was “too inept and intimidated” to properly

advocate his position. Furthermore, petitioner alleges

that this admission was a violation of Federal Rule of

Evidence 107.

In order to prevail on his claim of ineffective assistance

of counsel, petitioner must satisfy a two-prong test.

First petitioner must prove that counsel’s performance was

so grossly deficient as to deny the petitioner his Sixth

Amendment right.

See Strickland v. Washington, 466 U.S. 668, 687 (1984).

In order to prove a deficient performance, petitioner must

show that counsel’s representation fell below “ an objective

standard of reasonableness.” See id. at 688. In demonstrating

such deficient performance, the petitioner must show that,

in effect, counsel’s errors were so serious that “counsel was

not functioning” as an advocate. See id. at 687. A court “must

indulge a strong presumption that counsel’s conduct falls

within range of reasonable professional assistance . . .”

Id. at 691.

2la

Appendix B

Second, to prove ineffective assistance of counsel must

show that he was prejudiced as a result of the deficient

performance of his attorney. See id. at 687. To show such

prejudice, petitioner must prove that the errors of the attorney

were “so serious as to deprive the defendant of a fair trial, a

trial whose result is reliable.” Jd. The petitioner must show

that there is a “reasonable probability that, but for counsel’s

unprofessional errors, the result of the proceeding would have

been different.” Jd. at 694.

Petitioner’s ineffective assistance of counsel claim is

without merit. Petitioner offers only vague and self-serving

allegations that his counsel, Mr. Moskowitz, failed to notify

the Court of false testimony’ and failed to object to the

admissions of the Lionel Benedict audio tapes. Petitioner has

offered no evidence substantiating these allegations.

To the contrary, the record demonstrates that

Mr. Moskowitz provided a solid and spirited defense on

petitioner’s behalf, and in no way tell below a standard of

reasonableness. Mr. Moskowitz did indeed challenge the

authenticity of the Lionel Benedict tapes. Moreover, through

vigorous cross-examination, Mr. Moskowitz obtained

concessions from several witnesses that they lied on prior

occasions and made statements that were inconsistent with

their testimony at trial. Assessing Mr. Moskowitz’s overall

performance during the trial, this Court cannot say that his

representation fell below an objective standard of

reasonableness. Indeed, even assuming arguendo

2. Since no evidence of perjury has been offered, any ineffective

assistance of counsel claim based upon Mr. Moskowitz’s alleged

failure to address perjurious testimony is meritless.

22a

Appendix B

Mr. Moskowitz’s performance was deficient, petitioner

suffered no prejudice since it is unlikely the result would

have been different in light of the overwhelming evidence

offered against him. Accordingly, petitioner’s ineffective

assistance of counsel claim is denied.

Petitioner also asserts a claim of ineffective assistance

of counsel based upon a conflict of interest. It is alleged that

Petitioner’s second defense counsel, Gail Nichols, Esq.

(“Nichols”), resigned as defense counsel after serving for

more than a year in that capacity. Petitioner argues that

Nichols suffered from an actual conflict of interest because

she resigned to become chief of the criminal division of the

same United States Attorney’s Office which prosecuted

petitioner.

Where an ineffective assistance of counsel claim is based

upon the existence of a conflict of interest arising from

counsel’s multiple representation, the petitioner

‘“‘must demonstrate that an actual conflict of interest adversely

affected his lawyer’s performance.” Cuyler v. Sullivan, 446

U.S. 335, 348 (1980). The mere possibility of a conflict of

interest is not sufficient to collaterally attack a conviction.

See id. Furthermore, once an actual conflict of interest is

found the petitioner need not prove prejudice. See id. At 349-

50. The Supreme Court has not expanded the standard set

forth in Cuyler beyond cases involving multiple

representation.

Petitioner’s conflict of interest claim is likewise without

merit. First, ineffective assistance of counsel based on a

conflict of interest typically involves multiple representation,

23a

Appendix B

where a lawyer defends two or more clients or represents or

previously represents a testifying witness. A conflict of

interest may also arise where an attorney was involved in

the alleged criminal activity. This case, however, does not

involve multiple representation. Rather, it deals with Nichols

joining the United States Attorney’s Officer (sic). Other than

self-serving conclusions, petitioner fails to establish an actual

conflict of interest on Nichols’ part. Indeed, there is not even

an existence of a “possibility” of a conflict of interest, which

in any event would not suffice to collaterally attack a

conviction.’ Petitioner offers only speculation and his own

suspicion of a conflict of interest. He has not explained what

Nichols did, or failed to do, as a result of the purported

conflict which may have affected the outcome of the trial.

This is not sufficient to grant petitioner’s request for relief.

As a result, petitioner’s claim of conflict of interest must be

denied.*

Lastly, petitioner in his amended petition alleges

government misconduct contributed to his convictions (sic).

He presents not a shred of evidence of government

misconduct. Nor has petitioner shown he was deprived of a

3. Nichols’ representation of petitioner ended before the

criminal trial commenced.

4. To the extent that, as respondent suggests, petitioner’s claim

of conflict of interest is actually a general ineffective assistance of

counsel claim because petitioner alleges Nichols’ attention to his case

diminished at some point, this claim is also denied. There is no

evidence that Nichols’ performance fell below an objective standard

of reasonableness and no evidence that petitioner suffered prejudice

as a result of any alleged deficiency in Nichols’ representation.

24a

Appendix B

fair trial in any way. This Court previously found no

government conduct (sic) occurred at trial. The Third Circuit

similarly rejected petitioner’s claim on this basis upon direct

review.

Because petitioner’s claims are wholly without merit,

no evidentiary hearing is warranted and the petition is denied

and dismissed.

CONCLUSION

For the aforementioned reasons, the petitioner Milton

Sonneberg’s petition to vacate, set aside, or correct the

sentence pursuant to 28 U.S.C. § 2255 is DENIED and

DISMISSED. Accordingly, this case is now CLOSED.

A certificate of appealability shall not issue since the

petitioner has not made a substantial showing of the denial

of a constitutional right.

An appropriate Final Order accompanies this Letter

Opinion.

/S/ Nicholas H. Politan

NICHOLAS H. POLITAN

U.S.D.J

25a

APPENDIX C — ORDER OF THE UNITED STATES

COURT OF APPEALS FOR THE THIRD CIRCUIT

DENYING PETITION FOR REHEARING

DATED JULY 14, 2003

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No.01-2067

MILTON SONNEBERG,

Appellant

V.

UNITED STATES OF AMERICA

On Appeal from the United States District Court

for the District of New Jersey

District Court Judge: The Honorable Nicholas H. Politan

(D. C. Civil No. 00-cv-01000)

SUR PETITION FOR REHEARING EN BANC

Present: SCIRICA, Chief Judge, SLOVITER, NYGAARD,

ALITO, ROTH, McKEE, RENDELL, BARRY, AMBRO

FUENTES, SMITH, Circuit Judges, and ALDISERT'

The Petition for Rehearing filed by the Appellant in the

above-entitled matter, having been submitted to the judges

1. Judge Aldisert is limited to panel rehearing only.

26a

Appendix C

who participated in the decision of this court and to all the

other available circuit judges of the circuit in regular active

service, and no judge who concurred in the decision having

asked for rehearing, and a majority of the circuit judges of

the circuit in regular service not having voted for rehearing,

the Petition for Rehearing by the panel and the Court en banc,

is hereby DENIED.

BY THE COURT

/s/ an

United States Circuit Judge

DATED: JUL 14 2003