NEW ORLEANS (AP) — A federal judge on Wednesday threw out some of the criminal convictions of two men found guilty of bilking Louisiana's movie production tax credit program, but refused to grant a new trial on others.
U.S. District Judge Martin Feldman upheld conspiracy and fraud charges against New Orleans lawyer Michael Arata and film producer Peter Hoffman and refused to grant a new trial for Hoffman's wife, producer Susan Hoffman, who was convicted of conspiracy, wire fraud and mail fraud.
The three were convicted in April following a trial that shone an unfavorable light on a program credited with bringing so much major film, television and commercial production to Louisiana that the state is sometimes known as "Hollywood South." The program could be trimmed next year amid huge state budget shortfalls.
Federal authorities say the Hoffmans and Arata, through companies they owned, purchased a dilapidated mansion just outside the French Quarter in 2007, with plans to turn it into a post-production facility. Authorities said the three used fraudulent documents to obtain more than $1 million in tax credits for work that was not actually done on the renovated mansion. They alleged that Arata purchased the credits at a discount from his partners and sold them at a profit to others.
In his order Wednesday, Feldman noted defense documents showing that the Esplanade Avenue mansion was indeed renovated into a production and post-production facility that had been operating since 2012. Amid the documents was a brochure touting the facility's role in productions including the movie "Ransom" and the HBO "True Detectives" series.
Feldman was particularly critical of prosecutors in his breakdown of one of the wire fraud counts, which involved a question of whether an email at any point was sent through a server outside of Louisiana — making it a federal matter of interstate commerce. Feldman said prosecutors not only failed to prove that the email traveled across state lines, they erroneously suggested that defense lawyers should have proved the email had traveled over a Louisiana server.
"This incendiary and petulant suggestion as to how the defendants could have strengthened their case fundamentally perverts the American criminal justice system and would destroy the very foundation of constitutional due process," Feldman said, cautioning that the burden of proof is on the prosecution.
Peter Hoffman was convicted on 21 charges in April; Feldman's ruling reduces that to 16. Arata, originally convicted on 13 counts, remains convicted of two, including an overarching conspiracy count. Arata and both Feldmans are due to be sentenced on Jan. 27.
– by AP Reporter Kevin McGill
