United States District Court, N.D. Georgia, Atlanta Division
MAGISTRATE TUDGE'S FINAL ORDER AND REPORT AND
RECOMMENDATION ON DEFENDANT'S PRETRIAL MOTIONS
RUSSELL G. VINEYARL UNITED STATES MAGISTRATE JUDGE.
Jun Ying ("Ying") is charged in a two-count
indictment with securities fraud, in violation of 18 U.S.C.
§ 1348, 15 U.S.C. §§ 78j(b) and 78ff, and 17
C.F.R. §§ 240.10b-5 and 240.10b5-l. [Doc.
Ying has filed a motion to dismiss the indictment, [Doc. 35],
and a motion for a bill of particulars, [Doc. 36], both of
which the government opposes, [Docs. 46 & 48]. Ying has
filed a reply in support of both of his motions, [Docs. 53
& 54], and for the reasons that follow, Ying's motion
for bill of particulars, [Doc. 36], is DENIED, and it is
RECOMMENDED that his motion to dismiss the indictment, [Doc.
35], be DENIED.
FACTUAL AND PROCEDURAL BACKGROUND
March 13, 2018, a grand jury returned an indictment against
Ying, charging him with two counts of securities fraud and
insider trading, in violation of 18 U.S.C. § 1348, 15
U.S.C. §§ 78j(b) and 78ff, and 17 C.F.R.
§§ 240.10b-5 and 240.10b5-l. [Doc. 1]. According to
the indictment, Ying was the Chief Information Officer
("CIO") for Equifax Inc/s ("Equifax")
United States Information Solutions business
unit. [Id. ¶ 3]. The indictment
alleges that from mid-May 2017 through July 2017, unknown
individuals were able to hack into Equifax's databases
and obtain personal identifying information of approximately
145 million people, and on July 29, 2017, Equifax discovered
the network security breach and began an investigation as to
the scope of the breach and to plan for remedial efforts.
[Id. ¶¶ 6-8].
August 12, 2017, through August 15, 2017, Equifax changed
internal administrative credentials for many of its internal
databases, and Ying was aware of these changes. [Id.
¶ 9]. By August 15, 2017, Equifax concluded that
consumers' personally identifiable information was likely
taken as a result of the data breach, and on this same day,
Equifax imposed a special trading ban for its employees who
were aware of the data breach. [Id. ¶¶
10-11]. On August 25, 2017, Ying, and several other employees
who reported to Ying, were asked to assist in responding to
the breach, but the breach was presented as a breach
opportunity involving a potential Equifax customer rather
than a breach of Equifax's databases. [Id.
¶ 12]. However, on this same day, Ying sent text
messages to W.M. that stated, "Sounds bad. We may be the
one breached" and "I'm starting to put 2 and 2
together." [Id. ¶ 13 (internal marks
August 28, 2017, Ying conducted several Internet searches for
information related to the value of the stock price of
Experian, another consumer reporting agency and competitor to
Equifax, following an Experian data breach in 2015.
[Id. ¶ 14]. Less than an hour after conducting
these Internet searches, Ying, who held stock options for
Equifax securities in a UBS Financial Services account ending
in 24 EF, accessed the UBS website; exercised all of his
available stock options in the account ending in 24 EF, which
resulted in him receiving 6, 815 shares of Equifax stock in
the same account; and then sold all of these shares for a
profit of over $480, 000. [Id. ¶¶ 15-16]. On the
following day, Ying sent M.D. a text message that said,
"I think some big media announcement is coming about
us" and "I think it might be bad." [Id. ¶
17 (internal marks omitted)]. Subsequently, on September 7,
2017, following the close of the stock market that day,
Equifax publicly disclosed the data breach, and the following
day, Equifax's stock dropped in price. [Id. ¶ 18].
The indictment alleges that Ying "traded in Equifax
securities on the basis of material nonpublic information
related to the data breach, and thereby earned illegal
profits and illegally avoided losses" and that this
activity was in violation of 18 U.S.C. § 1348, 15 U.S.C.
§§ 78j(b) and 78ff, and 17 C.F.R. §§
240.10b-5 and 240.10b5-l. [Id. ¶¶ 19-20,
22]. Ying has filed two motions in relation to the instant
indictment, see [Docs. 35 & 36], and after having been
fully briefed, the pending motions are ripe for ruling.
Motion to Dismiss the Indictment, [Doc. 35]
charged with two counts of illegal insider trading, in
violation of 18 U.S.C. § 1348 in Count One, and in
violation of 15 U.S.C. §§ 78j(b) and 78ff in Count
Two. [Doc. 1]. Ying moves to dismiss these charges, arguing
that the indictment is multiplicitous and fails to allege the
essential elements of the charged offenses. [Doc. 35-1]; see
also [Doc. 53]. In response, the government maintains that
the indictment is not multiplicitous because each count
requires an element of proof that the other count does not
require and that the indictment adequately alleges the
charged offenses. [Doc. 46]. For the reasons that follow, the
Court agrees with the government.
indictment is multiplicitous if it charges a single offense
in more than one count." United States v.
Williams, 527 F.3d 1235, 1241 (11th Cir. 2008)
(citations omitted). "A multiplicitous indictment not
only subjects the defendant to numerous sentences for one
offense, but also prejudice[s] the defendant and confuse[s]
the jury by suggesting that not one but several crimes have
been committed." Id. (alterations in original)
(footnote, citation, and internal marks omitted). Therefore,
"[a] multiplicitous indictment  violates the
principles of double jeopardy because it gives the jury
numerous opportunities to convict the defendant for the same
offense." Id. Thus," [b]ecause a
multiplicitous indictment involves double jeopardy issues,
multiplicity and double jeopardy challenges are typically
evaluated under the same standards." United States
v. Woods, 730 F.Supp.2d 1354, 1376 (S.D. Ga. 2010),
affd, 684 F.3d 1045 (11th Cir. 2012) (per curiam).
"Accordingly, the test enunciated in [Blockburger v.
United States, 284 U.S. 299 (1932), ] used to evaluate
double jeopardy challenges ... is also used to determine
whether an indictment is multiplicitous, verifying that each
count requires an element of proof that the other counts do
not require." Id. (citation and internal marks omitted).
Blockburger[, ] the test to be applied to determine whether
two statutory provisions prohibiting the same conduct violate
the Double Jeopardy Clause, or whether each count of the
indictment may result in a conviction for the same offense,
is whether each provision [or count] requires proof of a fact
which the other does not." Id. (last alteration
in original) (citation and internal marks omitted). Pursuant
to this test, "the focus is on the proof necessary to
establish the statutory elements of the offense, not the
actual evidence presented at trial." Id.
(citation omitted). Ying asserts that the "elements of
proof for [18 U.S.C. § 1348 and 15 U.S.C. §§
78j and 78ff] are identical," see [Doc. 35-1 at 13-15],
but this contention is incorrect. Count One of the indictment
charges a violation of 18 U.S.C. § 1348, which provides:
knowingly executes, or attempts to execute, a scheme or
(1) to defraud any person in connection with .. . any
security of an issuer with a class of securities registered
under section 12 of the Securities Exchange Act of 1934 (15
U.S.C. 781) or that is required to file reports under section
15(d) of ...