OneTaste Inc. has retained me to investigate the prosecution of Nicole Daedone and Rachel Cherwitz.
Stolen Privilege
According to recent court filings by the US Attorney’s Office for the Eastern District of NY, a hacker provided a document to an FBI agent to use in the investigation of OneTaste Inc. The hacker stole the document from OneTaste’s cloud server.
The matter is complicated because the stolen document is marked “attorney client privilege.”
McGinnis’ Role Under Scrutiny
FBI Special Agent Elliot McGinnis used the stolen document and concealed its existence from the defense. If the prosecutors are to be believed, FBI Agent McGinnis also hid the document from the assistant US attorneys handling the prosecution: Gillian Kassner, Devon Lash, and Kayla Bensing.
After a five-year FBI investigation, the US Attorney for the EDNY filed an indictment in 2023 charging Daedone and Cherwitz with forced labor conspiracy. McGinnis was the lead agent handling the investigation.
The Hacker Identified
In 2015, Mitchel Aidelbaum was OneTaste’s IT contractor. He had worked for the company for about a year when he and his girlfriend, both OneTaste students, broke up.
Aidelbaum blamed OneTaste for the breakup. He quit in January 2016 and later hacked into the company’s cloud storage. He stole logs of sales calls, videos of OneTaste classes, personal documents of two executives, and a 25-page document with the file name “Attorney-Client Privilege: Confidential and Privileged.”
Aidelbaum copied sensitive business information, proprietary data, and a privileged document. He violated the Computer Fraud and Abuse Act, a felony with a prison sentence of five years or longer.
FBI Agent McGinnis Meets Aidelbaum
On January 26, 2021, FBI Special Agents Elliot McGinnis and Colleen Sheehan interviewed Aidelbaum at his home as part of their investigation into OneTaste.
Aidlebaum confessed to hacking into OneTaste’s server and described the videos and documents he had stolen.
According to FBI Special Agent McGinnis’s interview report (302 report), Aidelbaum spoke about a document he stole, which described “various derogatory acts at OneTaste.”
On McGinnis’s notes, which the prosecutors made public in a court filing last week, which McGinnis took by hand on the day he interviewed Aidelbaum, McGinnis put in a detail that does not appear in his subsequent 302 report which the prosecutors also made public:
McGinnis wrote “Has a copy Attorney Client Privilege. Laid out all the bad stuff they had done.”
Though Aidelbaum stole other documents and videos, McGinnis focused on the attorney-client document with the supposed “bad stuff.”
Can’t Read Privileged Documents
McGinnis told Aidelbaum the US Attorney would subpoena the other documents. But he wanted the attorney-client document immediately. He handed Aidelbaum a thumb drive, and Aidelbaum copied the document and gave it back to agents McGinnis and Sheehan. At this point, the FBI agents received hacked materials marked as attorney-client privilege.
The possible reason for the urgency in obtaining the document that day is that the agents might have expected it to be a roadmap to prove the alleged crimes they had investigated for over two years. There was a hitch. An FBI agent who obtains a document – whether stolen or not – that might be attorney-client privileged, cannot read it on the spot. He can’t use it or else it could “taint” the entire case.
The Department of Justice strictly required McGinnis to give the document unread to the US attorney’s office, which would then create a “Filter Team” to determine if attorney-client privilege protects the document.
The US Department of Justice (“DOJ”) manual Justice l 9-13.420 (E)1 is explicit:
“to protect the attorney-client privilege and to ensure that the investigation is not compromised by exposure to privileged material relating to the investigation or to defense strategy, a ‘privilege team’ should be designated, consisting of agents and lawyers not involved in the underlying investigation.
Instructions should be given …to … ensure that the privilege team does not disclose any information to the investigation/prosecution team unless and until so instructed by the attorney in charge of the privilege team.”
Agents Left With Document and It Disappears
McGinnis and Sheehan left Aidelbaum on January 26, 2021 with a thumb drive with a stolen privileged document. McGinnis did not turn it over to the DOJ to create a filter team and review it.
It appears he hid its existence.
On February 11, 2021, McGinnis submitted his mandated FBI 302 report of his and Sheehan’s meeting with Aidlebaum.
Whenever an FBI agent takes custody of evidence from a witness, they must put it in a sealed envelope (or box). With the 302 form, McGinnis should have attached an FBI ‘A-1, ‘with the thumb drive in a sealed envelope.
Based on the US Attorney’s recent filing, McGinnis never turned in the thumb drive with the privileged document.
Instead, McGinnis and Sheehan withheld the thumb drive from evidence handling. If they had turned in the thumb drive, the document would have been sequestered and the Filter Team might never let them have it.
On top of that, the fact that they had a stolen document might require the agents to report the crime to the court, and at least, the US Attorney would have to notify OneTaste about the theft.
Its value lay in its content; McGinnis realized that what the defense didn’t know might help him, so McGinnis took the short path. Instead of turning it in, McGinnis used the document to build his case.
Within days of getting the stolen privilege document, subpoenas went out. According to disclosures of various individuals, McGinnis began interviewing OneTaste and former OneTaste students and employees based on what some now believe was information from the stolen privilege document.
Cooper Comes In
The theft and the FBI agent’s cover-up might have never come to light if the hacker, Aidelbaum, had not shared the stolen document with former OneTaste student, Andrew Cortado, who, in turn, shared it with Kara Cooper, a disgruntled former OneTaste student.
Kara Cooper
Nine months after McGinnis took the stolen privilege document from Mitch Aidelbaum’s house and hid its existence from those who had the legal right to know, McGinnis interviewed Kara Cooper.
Cooper must have flabbergasted the agent when she told McGinnis she had photographs of iPhone screenshots of a certain document, a litany of OneTaste’s supposed bad acts, which was stamped privileged.
Did he want it?
That was probably the last thing McGinnis wanted.
But Cooper insisted on sending them. She emailed McGinnis 25 JPEG photos of screenshots of the same document Aidelbaum had stolen which had been in McGinnis’ possession for nine months.
The emails were a problem.
While McGinnis did not turn the original thumb drive into evidence, he had no choice but to turn Cooper’s emailed photographs of screenshots of the document into evidence. Unlike a tiny thumb drive which he can secrete, lose, or say he forgot about, he cannot lose or delete FBI emails. They stay on the system.
Indictment of OneTaste Execs
Rachel Cherwitz and Nicole Daedone
In April 2023, the US Attorney filed an indictment against Nicole Daedone and Rachel Cherwitz on a single count of forced labor conspiracy. The indictment alleges Daedone and Cherwitz conspired for 12 years to force people associated with OneTaste to labor. The EDNY did not charge Daedone and Cherwitz with the actual substantive crime of forced labor.
On September 18, 2023, the US Attorney for the EDNY turned over more than 200,000 pages of documents in discovery. It took months to go through it, but in April 2024, the defendants discovered Cooper’s 25 photos of cellphone screenshots. They realized they had been hacked.
OneTaste attorney Paul Pelletier called to demand the return of the privilege documents.
After his call, the prosecution handed Cooper’s 25 photos of the screenshots of the privileged document to a Filter Attorney – 30 months after they got them from Cooper.
The defendants argued the entire indictment tracks the events and allegations in the privileged document. Now the defendants legal team understood how the indictment was so entirely false. It stolen and hidden attorney-client document was evidently misinterpreted by McGinnis.
Keep Trying
AUSA Gillian Kassner is the lead prosecutor.
The prosecutors swore they never looked at Cooper’s photos, and now they have set up a filter team – so no harm done.
The defendants argued somebody read the attorney-client document and misinterpreted it. That’s why the indictment reads as stupidly as it does. (A 12-year conspiracy to force people to labor, which failed. There is no forced labor charge. It is a first in legal history: An indictment with only a forced labor conspiracy charge without an actual substantive crime.)
Tainted Case
The defendants filed a motion to dismiss the case since it was clearly tainted by not employing a filter team when the government first got the hacked documents. It seemed implausible that the indictment could track an attorney-client document nobody had seen.
At the time, the defense, and the prosecutors if they are to be believed, did not know that McGinnis had been hiding the original document Aidelbaum gave him on January 26, 2021. That might explain why the indictment tracked the stolen document but the prosecution claimed they never reviewed Cooper’s photos.
Pelletier, who represents OneTaste, had experience with corruption. For 25 years, he was the nation’s top fraud prosecutor with the Department of Justice.
OneTaste lawyer Paul Pelletier, for more than 25 years, the senior financial fraud prosecutor at the Department of Justice.
He began to press the US Attorney’s Office in Brooklyn, just as he had done with all the 93 US Attorney districts as the lead prosecutor overseeing fraud cases in the federal criminal justice system.
New Evidence
The prosecutors, on high alert, began an internal investigation. They soon filed a court pleading, writing that they “recently obtained” some new information “concerning the Document and its receipt by the Federal Bureau of Investigation (the “FBI”).”
That information?
“A thorough search” of the US Attorney’s Office’s internal files and emails showed that no one had ever received a copy of the original document Aidelbaum gave to McGinnis on a thumb drive. No one could find the original stolen document, just the photos Cooper emailed McGinnis.
Pelletier revealed an affidavit filed by Aidelbaum, revealing he had given McGinnis the thumb drive.
The prosecutors went to McGinnis and asked him.
The prosecutors, clearly distancing themselves from McGinnis, wrote in a court filing, “The FBI Special Agent said he searched all the thumb drives he still had in his possession and did not find the original document.”
Lost it was?
FBI Special Agent Colleen Sheehan said she did not have the original document either.
Nervous, the prosecutors left their offices and went to the FBI building on September 9, to conduct an “in-person manual search of hard copy and electronic files at the FBI.”
Eureka
There, on the FBI electronic system called Sentinel, the prosecutors found a folder with Aidelbaum’s name in which two Microsoft Word files were saved entitled “Attorney Client Privilege: Confidential and Privileged.”
In their filing, the prosecution did not care to tell the judge or the defense when the folder was inputted in the FBI Sentinel system, who put it in, or if it had made a very recent arrival.
After finding the folder, the prosecution returned to McGinnis and Sheehan, and, as the prosecutors wrote, they “learned the following, in sum and substance and in part“ (but not in full).
McGinnis and Sheehan “do not specifically recall viewing or receiving any documents from (Aidelbaum) during the January 26, 2021 interview.”
However, “one of the interviewing Special Agents informed the government that he/she believes it is likely that he/she viewed or possessed a copy of the (attorney-client) Word Documents in January 2021.”
While the prosecution does not care to disclose to the judge or the defense whether it was McGinnis or Sheehan, one of them admitted they viewed or possessed the stolen privileged document. In so doing, she essentially admitted McGinnis handled this and she would not care to take the fall.
No Bigger Than His Thumb
But no one turned in the thumb drive. No one gave the original document to the prosecution, or the defense, but someone uploaded it on the FBI Sentinel system.
The prosecution is clearly trying to distance themselves from the FBI to extricate themselves from the inextricably intertwined taint of the FBI lead case agent using a stolen privileged document to build its case which they still expect to prosecute.
Case is Doomed
The FBI case agent secreted the stolen document, hid it from the prosecution, and the defense then went into the grand jury and testified. McGinnis cannot be merely thrown under the bus and let the prosecutors ride over the defendants anyway.
Even in the EDNY, prosecutors can’t get away with that. US District Court Judge Diane Gujarati will rule on the motion to dismiss and may call for an evidentiary hearing before making her decision.
