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United States v. Snyder

United States District Court, N.D. Ohio, Eastern Division

May 18, 2018



          Benita Y. Pearson United States District Judge

         Pending before the Court are four motions, three from Defendant Charles David Snyder and one from the Government: (1) Defendant's Motion to Compel (ECF No. 20); (2) Defendant's Motion to Dismiss the Indictment (ECF No. 21); (3) Defendant's Motion to Disclose Grand Jury Transcripts (ECF No. 22); and (4) the Government's Motion to Quash Subpoenas Issued to the IRS and DOL (ECF No. 32). The Government has responded to all three of Defendant's motions.[1] See ECF Nos. 25, 26, & 27. Defendant has responded to the Government's motion. ECF No. 35. Defendant has filed a reply to his motion to disclose grand jury transcripts. ECF No. 34. After receiving new evidence through discovery, Defendant has filed a supplemental brief to his motions to disclose grand jury transcript and to dismiss indictment. ECF No. 44. In response to Defendant's supplement, the Government has filed a supplemental brief of its own. ECF No. 49. For the reasons that follow, Defendant's motions are denied, and the Government's motion is granted in part.

         I. Background

         A. Indictment

         The Government has indicted Defendant on seven counts of Willful Failure to Collect, Account for, or Pay Over Taxes, 26 U.S.C. § 7202, 18 U.S.C. § 2, and one count of Embezzlement from an Employee Benefit Plan, 18 U.S.C. §§ 664, 2. ECF No. 1. The indictment alleges Snyder embezzled approximately $130, 416.75 from his company's 4Ol(k) retirement plan between July 31, 2010 and December 19, 2012. Id. at PagelD #: 8. The Department of Labor filed an ERISA suit against Snyder and others on November 7, 2013. Perez v. Snyder, 1:13CV2474 (N.D.Ohio) (Boyko, J.). The parties resolved the lawsuit by entering into a consent judgment. ECF No. 33 of 1:13CV2474.

         Defendant was chairman, president, and chief executive officer of Attevo, Inc., a technology consulting services corporation. ECF No. 1 at PagelD #: 1. Defendant is alleged to have failed to pay taxes Attevo owed and embezzled money from Attevo's 401(k) retirement plan.

         B. Discovery

         For discovery in the present case, the Government provided over 41, 000 pages of documents under Criminal Rule 16. ECF No. 25 at PagelD #: 171. After the Government made this production, Defendant requested 12 categories of materials he claimed the Government did not produce. ECF No. 25-2. The list is as follows:

1. Copies of all subpoenas issued;
2. Copies of all grand jury testimony;
3. Copies of all Memorandums of Interviews (MOI's);
4. Entire Attevo IRS "Archive History Transcript" not just IRS Revenue Officer Evelyn Terry;
5. IRS "Archive History Transcript" for all related entities, including, but not limited to, Cirric, Ruralogic, Awerrock and Superior Tech Partners;
6. IRS "Archive History Transcript" for C. David Snyder, including all trust fund penalty investigation materials;
7. IRS "Archive History Transcript" for Joseph Burmester, including all trust fund penalty investigation materials;
8. Copies of all DOL notes and internal memoranda related to its investigation of the Attevo/Ruralogic 4Ol(k) Plan;
9. Copies of all memoranda related to Attevo/Ruralogic 401(k) Plan employee withholdings, deposits and dates corresponding to same;
10. Copies of all notes and recordings related to DOL civil suit styled as Thomas E. Perez, Sec. of Labor v. Charles David Snyder, et al, No. 13-cv-2474;
11. Copies of all IRS memoranda and notes related to the transfer of Form 941 designated payments through the EFTPS online payment system; and
12. Copies of all documents obtained from payroll companies utilized by Attevo and Ruralogic.

Id. at PagelD #: 191. After receiving the request, the Government asked Defendant for authority to support the request. Id. at PagelD #: 190-91. Defendant complied with this demand, and the Government provided further response. Id. at PagelD #: 188-90. In its final response, the Government explained that it would not produce documents related to requests 1-3, because it believed it had no authority to do so, and that requests 4-12 only applied to documents held by the prosecution team, not the entire federal government. Id. at PagelD #: 188.

         C. Grand Jury Testimony

         Defendant has requested grand jury transcripts on the theory that "some form of conduct must have occurred before the Grand Jury in order for the Grand Jury to find that [Defendant] willfully failed to pay Attevo's payroll taxes for the first and third quarters of 2010." ECF No. 22atPageID#: 151.

         On November 5, 2010, Defendant and Joseph Burmester wrote a letter to Evelyn Terry, a revenue officer at the IRS. ECF No. 27-1. In that letter, Defendant acknowledged that a payment Attevo had made could "be credited to a prior quarter, " not the period in which it made the payment. Id. at PagelD #: 250.

         D. ...

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