United States v. Litvak

Jesse Litvak (defendant), a mortgage-backed-securities trader, lied to buyer Brian Norris about how much he had paid for the securities he was selling, overstating his cost by about $73,000 in a way that likely led Norris to offer more than he otherwise would have. At Litvak's securities-fraud trial, the government introduced Norris's testimony that he believed Litvak was acting as his agent, hoping to bolster its materiality argument, even though the evidence — and the court's own jury instructions — established that a securities broker-dealer is never actually an agent for the buyers he sells to. Litvak was convicted and appealed, arguing the misrepresentation was not material and that Norris's agency-belief testimony should have been excluded as confusing.