No Hollywood Ending

A Louisiana Hearing Committee recommends disbarment (but not permanent) of an attorney convicted of a federal offense.

The United States Court of Appeals for the Fifth Circuit described the case in a 2018 opinion

With its colorful history and rich cultural stew, Louisiana has long been a popular setting for works of fiction, including movies. In recent years the state has also tried to become a place where films are made. That effort enjoyed considerable success. The Curious Case of Benjamin Button, Django Unchained, Twelve Years a Slave, The Dallas Buyer’s Club, and Dawn of the Planet of the Apes are some recent films of note shot in New Orleans. Believe it or not, in one recent year (2013) Louisiana surpassed even California as the most popular locale for filming major-studio productions. Mike Scott, Louisiana Outpaces Los Angeles, New York, and All Others in 2013 Film Production, Study Shows, TIMES-PICAYUNE (Mar. 10, 2014). This development led some to call New Orleans “Hollywood South.” Id.

State tax credits for the film industry spurred much of this growth. Id. (“[M]ake no mistake: The state’s tax-credit program . . . is largely responsible for the surge in local productions.”). They also provided an incentive for fraud. A jury found that to be the case for Peter Hoffman, Michael Arata, and Susan Hoffman. It credited the government’s allegations that they submitted fraudulent claims for tax credits, mostly by (1) submitting false invoices for construction work and film equipment or (2) using “circular transactions” that made transfers of money between bank accounts look like expenditures related to movie production. Their principal challenge to those convictions is an
argument that the tax credits are not property within the meaning of the mail and wire fraud statutes but are instead akin to the video poker licenses the Supreme Court rejected as a basis for federal prosecution in Cleveland v. United States, 531 U.S. 12 (2000). If we conclude that the credits are property subject to the federal fraud statutes, defendants also contend that the evidence was insufficient to convict because they made a good-faith effort to comply with a state program riddled with gray areas.

While the defendants seek to undo their convictions, the government is unhappy with the sentences of probation that all three received. So it too appeals, arguing that the substantial downward variances exceeded the district court’s discretion. The government also contends that the district court improperly vacated a number of the jury’s guilty verdicts…

To recap our many rulings: We AFFIRM the district court’s denial of defendants’ motions to dismiss the indictment. We AFFIRM the district court’s denial of defendants’ motions for judgment of acquittal, and AFFIRM in part and REVERSE in part the district court’s grant of defendants’ motions for judgment of acquittal. We AFFIRM the district court’s denial of defendants’ motions for new trial. We AFFIRM the district court’s forfeiture award. Finally, we VACATE Peter Hoffman’s sentence and REMAND for resentencing. We AFFIRM Susan Hoffman’s sentence. And we VACATE Arata’s sentence and REMAND for resentencing.

He has been suspended since February 2016. (Mike Frisch)