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Kurniawan Loses Bid to Exclude Counterfeiting Evidence

Federal judge rules that FBI had probable cause to search defendant's home; trial could be scheduled at a hearing next month

Peter Hellman
Posted: January 17, 2013

A federal judge has ruled that FBI agents acted properly when they searched the California home of accused wine counterfeiter Rudy Kurniawan moments after arresting him last year. At a Jan. 17 hearing in a New York courtroom, U.S. District Judge Richard Berman denied a motion by Kurniawan's attorneys to exclude evidence found during the search. Kurniawan must now decide whether to go to trial or change his plea of not guilty.

Agents arrested Kurniawan at his mother's Los Angeles-area home on the morning of March 8, 2012. During the arrest, agents conducted an initial search of the house and obtained a key to a locked room from Kurniawan, entered it and found what they claim was a wine-counterfeiting workshop. Only later that day did agents return with a search warrant.

In a motion to exclude the evidence, Kurniawan's lawyers claimed that the first, warrantless, search violated his Fourth Amendment rights. In a memorandum, Justice Department attorneys countered that, even without including the evidence of the FBI sweep that morning in its request for a search warrant, there was probable cause for a magistrate to issue it. The government lawyers noted that Kurniawan "on multiple occasions" had received shipments of empty bottles of very expensive wine which he had requested from a Manhattan restaurant and a New York collector and that last February he had tried to sell homemade counterfeit wine through a third party at a London auction. They also noted that the agents were concerned Kurniawan's mother might destroy evidence before they returned with a warrant.

Berman said from the bench, "The long and the short of my ruling is that, based on the totality of the circumstances, in my judgment the search warrant was clearly based on probable cause." Kurniawan, 36, sat in the courtroom, dressed in mismatched khaki pants and shirt with black sneakers, wearing his trademark eyeglasses with thick black frames. He showed no emotion as the judge announced his decision. He is being held at the Metropolitan Detention Center in Brooklyn, N.Y.

Berman scheduled a conference with the lawyers for Feb. 14 to determine what will happen next in the case. It appears that Kurniawan's options are to go to trial or try and negotiate a plea bargain. Besides being charged with selling counterfeit wine, Kurniawan is also accused of schemes to defraud a finance company by falsifying his application for a $3 million loan, and of double-pledging art works as collateral for additional loans from a New York auction house, and of attempting to defraud a California collector and the New York auction house. According to Kurniawan's attorney, Michael Proctor, his client remains "strong and focused on his case."

It was seven years ago this month that Acker Merrall & Condit held an auction in New York based on Kurniawan's cellar. Among the lots was a bottle of Domaine de la Romanée-Conti Romanée-Conti 1934 that sold for $12,925, a six-bottle lot of Roumier Bonnes Mares that sold for $28,955, and a 10-bottle lot of Château Cheval-Blanc 1947 that sold for $48,260. According to the indictment of Kurniawan, dated last May, all those wines were counterfeit.

Ted Hudgins
Naples, FL —  January 18, 2013 11:08am ET
I feel bad (not really!) for Rudy's lawyers who have to deal with a bona fide sociopath like him. Yes, I know they are getting handsomely compensated, but just the thought of having to listen to Rudy whine on about how the government (and Sotheby's, etc.) are ALL wrong and how he's innocent must be tiring. Most normal clients face reality when confronted with an overwhelming amount of now properly admitted evidence, but somehow I think this one will drag on for who knows how long. Maybe Rudy can make pruno and pass it off as the good stuff when he's doing 10-20.
We can only hope the other counterfitters out there are listening and taking notes about the downside to the fraud they have perpetrated on what used to be a very civilized trade.
Lawrence Newcombe
bay City , MI —  January 18, 2013 11:44am ET
With the huge surge in Asian wealth and the desire for the rare and highly sought after wines from France and elsewhere , one can only imagine ( and be wary)of who else is toiling away in the land of coping , counterfeiting , product fraud. Doubt this will be last of these major ripoff crimes in the wine community .

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