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United States v. Connolly

United States v. Connolly

United States Court of Appeals for the Second Circuit

April 14, 2021, Argued; January 27, 2022, Decided

Docket Nos. 19-3806-cr(L), 19-3944-cr(CON), 19-3945-cr(XAP), 19-3964-cr(XAP)

Opinion

 [*823]  KEARSE, Circuit Judge:

Defendants Matthew Connolly and Gavin Campbell Black appeal from judgments entered in the United States District Court for the Southern District of New York following a jury trial before Colleen McMahon, then-Chief Judge, convicting both defendants on one count charging a 2004-2011 conspiracy to commit wire fraud and bank fraud in violation of 18 U.S.C. § 1349, convicting Connolly on two counts of wire fraud in violation of 18 U.S.C. § 1343, and convicting Black on one count of wire fraud in violation of § 1343, all in connection with the submission of statements that could affect the London Interbank Offered Rate ("LIBOR"), on which many financial transactions rely. Connolly was sentenced principally to three concurrent terms of time served plus two years of supervised release (the first six months in home confinement), and was ordered to pay a $100,000 fine. Black was sentenced principally to two concurrent terms of time served plus three years of supervised release (the first [**4]  nine months in home confinement) to be served in his native United Kingdom, and was ordered to pay a $300,000 fine. On appeal, defendants contend principally that the evidence at trial was insufficient to prove that the LIBOR submissions at issue were false, material, or made with fraudulent intent.

The government cross-appeals to challenge defendants' sentences, arguing that it constituted plain error to permit Black to serve a sentence of home confinement in the United Kingdom without adequate assurance that such a term of overseas home  [*824]  confinement could be appropriately monitored. It argues that both defendants should be resentenced because if the monitoring of Black were inadequate, it would result in punishment less severe for Black than that imposed on Connolly, despite the district court's assessment that Black was more culpable than Connolly.

Finding merit in defendants' contentions that the evidence was insufficient to show that the LIBOR-related statements that they induced were false, we reverse their convictions and remand to the district court for entry of judgments of acquittal. We dismiss the government's cross-appeals as moot.

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24 F.4th 821 *; 2022 U.S. App. LEXIS 2566 **; 2022 WL 244669

UNITED STATES OF AMERICA, Appellee-Cross-Appellant, - v. - MATTHEW CONNOLLY and GAVIN CAMPBELL BLACK, Defendants-Appellants-Cross-Appellees.

Prior History: Appeals from judgments entered in the United States District Court for the Southern District of New York following a jury trial before Colleen McMahon, then-Chief Judge, convicting defendants of wire fraud in violation of 18 U.S.C. § 1343 and conspiracy to commit wire fraud and bank fraud in violation of 18 U.S.C. § 1349 [**1] , in connection with the London Interbank Offered Rate ("LIBOR"), and sentencing them principally to time-served and supervised release, including various periods in home confinement, and imposing monetary fines. On appeal, defendants contend principally that the trial evidence was insufficient to prove the falsity, materiality, or fraudulent intent elements of the offenses of which they were convicted.

Cross-appeals by the government to challenge the sentences imposed, contending principally that the district court failed to determine the availability of adequate monitoring for one defendant's home confinement and that that failure could result in punishment inadequate to reflect the court's assessment of the defendants' relative culpability.

Finding that the evidence was insufficient as a matter of law to permit a finding of falsity, we reverse the judgments of conviction and remand to the district [**2]  court for entry of judgments of acquittal. The government's cross-appeals with regard to sentencing are thus moot.

United States v. Connolly, 2017 U.S. Dist. LEXIS 36759 (S.D.N.Y., Mar. 2, 2017)

Disposition: Judgments reversed; cross-appeals dismissed as moot.

CORE TERMS

LIBOR, pricer, derivatives, traders, rates, borrow, interest rate, trading, desk, requests, banks, manually, wire fraud, submitters, defendants', convictions, estimate, automatically, positions, brokers, tenor, offers, interbank, spreads, falsity, percent, dollar, borrow funds, fraudulent, prices

Criminal Law & Procedure, Standards of Review, Substantial Evidence, Sufficiency of Evidence, Evidence, Burdens of Proof, Allocation, Weight & Sufficiency, Inferences & Presumptions, Inferences, Proof Beyond Reasonable Doubt, Fraud Against the Government, Mail Fraud, Elements, Governments, Legislation, Interpretation, Fraud, Wire Fraud, Trials, Prosecution