United States District Court, D. Connecticut
MEMORANDUM OF DECISION GRANTING IN PART AND DENYING
IN PART MOTIONS IN LIMINE
VANESSA L. BRYANT UNITED STATES DISTRICT JUDGE
August 3, 2016, a federal grand jury sitting in New Haven,
Connecticut returned an indictment against Defendant Edward
Kosinski charging him with two counts of Insider Trading in
violation of 17 C.F.R. Section 240.10b-5 and 15 U.S.C.
Sections 78j(b) and 78ff. [Dkt. 1 (Indictment).] On September
26, 2017, the Defendant filed two motions in limine
challenging two categories of evidence offered for trial.
[Dkt. Nos. 40, 43]. These categories include (1) evidence of
Defendant's alleged regulatory violation and (2) expert
testimony by lay witnesses. Also on September 26, 2017, the
Government filed one motion in limine challenging two
categories of evidence: (1) evidence that the Government
engaged in “selective prosecution;” and (2)
evidence of Defendant's prior “good acts, ”
character, reputation, and personal background. [Dkt. 46.] For
the reasons that follow, Defendant's motion to exclude
evidence of regulatory violations is DENIED as moot,
Defendant's motion to exclude expert testimony is DENIED
without prejudice, the Government's motion to exclude
evidence of selective prosecution is GRANTED, and the
Government's motion to exclude evidence of prior good
acts, character, reputation, and personal background is
GRANTED in part and DENIED in part.
Standard of Review
purpose of an in limine motion is to aid the trial
process by enabling the Court to rule in advance of trial on
the relevance of certain forecasted evidence, as to issues
that are definitely set for trial, without lengthy argument
at, or interruption of, the trial.” Palmieri v.
Defaria, 88 F.3d 136, 141 (2d Cir. 1996) (internal
citations omitted). “A motion in limine to
preclude evidence calls on the court to make a preliminary
determination on the admissibility of the evidence under Rule
104 of the Federal Rules of Evidence.” Highland
Capital Management, L.P. v. Schneider, 379 F.Supp.2d
461, 470 (S.D.N.Y. 2005) (internal citations omitted).
“Evidence should be excluded on a motion in
limine only when the evidence is clearly inadmissible on
all potential grounds.” Id. “A district
court's in limine ruling ‘is subject to
change when the case unfolds, particularly if the actual
testimony differs from what was contained in the . . .
proffer.'” Id. (quoting Luce v. United
States, 469 U.S. 38, 41 (1984)).
Defendant's Alleged Regulatory
moves to exclude as irrelevant evidence that he violated
certain regulations by not promptly disclosing his
investments with Regado. [Dkt. 40.] The Government responds
that such evidence is relevant to the offenses of indictment
because it “tends to show the defendant's awareness
that his insider trading was wrongful and needed to be
concealed.” [Dkt. 50 at 2.]
Court ordered the Government to supplement its briefing
stating what facts support its conclusion that Defendant
committed a regulatory violation and citing the regulations
violated. [Dkt. 53.] The parties indicated in their
supplemental briefing, and confirmed at the October 24, 2017
hearing, that they agree upon the admissibility of the two
financial forms the Government seeks to offer (Dkt. 54-1 at
¶ 006958-59) and will not offer the accompanying email
correspondence into evidence (Dkt. 54-1 at ¶ 006956-57).
Defendant's motion is accordingly DENIED as moot.
Expert Testimony by Lay Witnesses
moves to preclude lay witness testimony regarding (i) the
significance of trading volume in a stock, (ii) financial
instruments, including stocks, put options, and other
derivative securities, (iii) NASDAQ, (iv) broker-dealers and
brokerage accounts, (v) the financial disclosures required by
21 C.F.R. 54.4(b), (vi) the nomenclature used in clinical
trials, and (vii) allergic reactions in clinical trials.
[Dkt. 43 at 1-2.] Defendant asserts these topics are outside
the scope of Federal Rule of Evidence 701 and are instead
proper for an expert witness, which the Government has not
disclosed as requiredd. Id.
Government responds that the intended testimony is proper lay
witness testimony, as it will merely “summarize
voluminous records concerning Regado stock and the
defendant's trading habits” and provide a
“fact-based summary of the defendant's trading and
the trading that occurred in Regado stock.” [Dkt. 49 at
5.] This summary will include defining “basic terms
that are in common use, but that may not be completely
understood by the jury (e.g. ‘stock, '
‘option, ' ‘put, ' ‘stock market,
' ‘trading volume, ' ‘NASDAQ, '
‘brokerage account, ' and similar terms).” In
addition, the Government states it will elicit “facts
that [lay] witnesses learned through their involvement in the
REG1 clinical trial.” Id. at 6. At the October
24, 2017 hearing, the Government clarified it intends to call
lay witnesses to testify about their experience as
professionals working on the Regado trial. The witnesses
would define terms used in clinical trials, such as
“phase two” and “risk mapping, ” only
insofar as they would explain the Regado trial to the jury.
testimony by lay witnesses is only admissible if (a)
rationally based on the witness's perception; (b) helpful
to clearly understanding the witness's testimony or to
determining a fact in issue; and (c) not based on scientific,
technical, or other specialized knowledge within the scope of
Rule 702.” Fed.R.Evid. 701. By contrast, a
“witness who is qualified as an expert by knowledge,
skill, experience, training, or education may testify in the
form of an opinion or otherwise if . . . the expert's
scientific, technical, or other specialized knowledge will
help the trier of fact to understand the evidence or to
determine a fact in issue . . .” Fed.R.Evid. 702(a).
Second Circuit has expounded upon the distinction between lay
and expert testimony: [t]he fact that [a witness] has
specialized knowledge, or that he carried out [an]
investigation because of that knowledge, does not preclude
him from testifying [as a lay witness], so long as the
testimony [is] based on the investigation and reflect[s] his
investigatory findings and conclusions, and [is] not rooted
exclusively in his expertise.” Bank of China, N.Y.
Branch v. NBM LLC, 359 F.3d 171, 181 (2d Cir. 2004).
Conversely, a lay witness may not testify “regarding