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Wednesday, January 6, 2010

Will Revised Justice Discovery Guidelines Affect "Bid Rig" Cases Using Solomon Dwek?

Recent cases have prompted the Department of Justice to issue new guidelines for its line prosecutors around the country regarding the sharing of evidence which could be potentially exculpatory or useful for impeaching government witnesses.   These cases, such as but not limited to the convictions of former Alaska Senator (and former U.S. Attorney for the District of Alaska) Ted Stevens, and several high-ranking corporate executives of Broadcom, Inc. including one executive whose guilty plea was thrown out, have produced significant embarassment for the Justice Department.  (In fairness, these cases were investigated and the decisions to proceed to charging them were made during the Bush Administration, and some speculate -- although I offer no opinion and imply none -- that the Obama Justice Department does not mind embarassing the previous adminstration's stewards.)

One Justice Department memo sets forth new guidelines and offers reminders on other guidelines.  Here are some observations on the guidelines memo.

First, there is a passage (see the last paragraph in section A) which provides:

"Prosecutors should begin considering potential discovery obligations early in an investigation that has national security implications and should also carefully evaluate their discovery obligations prior to filing charges."

I would suggest that this policy should be extended to cover all investigations, not just ones involving national security.   The evaluation of discovery obligations earlier in the process may result in a more thoughtful, and ultimately correct, analysis of a case.   This in turn may lead to a more efficient disposition of investigations and, where investigations can be more readily ended, this frees up resources to devote to other cases.  I submit that getting a more efficient process, while also reducing the potential for errors or mistakes, should be important.

Section B, paragraphs 1 and 2 regarding items under "What to Review" prompt some concerns.  The inclusion of these paragraphs suggests that there has been a less than totally frank sharing of information between agencies (unless it is either deliberate or deliberately used as a convenient excuse to avoid or delay discovery) and raises the question as to whether some defendants have been prejudiced, or even whether some investigations have gone off on tangents (sometimes derided as "fishing expeditions") and in the process causing consternation and aggravation to some pretty innocent and hence undeserving targets.

Paragraph 2 sparks some curiouslty regarding a huge series of prominent corruption cases in New Jersey.   The paragraph begins as follows: 

2. Confidential Informant (CI)/Witness (CW)/Human Source (CHS)/Source (CS) Files: The credibility of cooperating witnesses or informants will always be at issue if they testify during a trial. Therefore, prosecutors are entitled to access to the agency file for each testifying CI, CW, CHS, or CS. Those files should be reviewed for discoverable information and copies made of relevant portions for discovery purposes. The entire informant/source file, not just the portion relating to the current case, including all proffer, immunity and other agreements, validation assessments, payment information, and other potential witness impeachment information should be included within this review.

I suspect that defense counsel for any of the 45 or so indicted or arrested individuals in "Bid Rig" investigations will be reviewing this memorandum, and looking at the foregoing paragraph in particular, with an eye on how much new information will be forthcoming regarding uber-cooperating witness Solomon Dwek.   These attorneys should be encouraged by the laundry list of relevant criteria regarding such witnesses which the memorandum also provides in Section B, paragraph 7, which reads as follows:

7. Potential Giglio Information Relating to Non-Law Enforcement Witnesses and Fed.R.Evid. 806 Declarants: All potential Giglio information known by or in the possession of the prosecution team relating to non-law enforcement witnesses should be gathered and reviewed. That information includes, but is not limited to:
  • Prior inconsistent statements (possibly including inconsistent attorney proffers, see United States v. Triumph Capital Group, 544 F.3d 149 (2d Cir. 2008))
  • Statements or reports reflecting witness statement variations (see below)
  • Benefits provided to witnesses including:
    • Dropped or reduced charges
    • Immunity
    • Expectations of downward departures or motions for reduction of sentence
    • Assistance in a state or local criminal proceeding

    • Considerations regarding forfeiture of assets
    • Stays of deportation or other immigration status considerations
    • S-Visas

    • Monetary benefits
    • Non-prosecution agreements
    • Letters to other law enforcement officials (e.g. state prosecutors, parole boards) setting forth the extent of a witness's assistance or making substantive recommendations on the witness's behalf
    • Relocation assistance
    • Consideration or benefits to culpable or at risk third-parties

  • Other known conditions that could affect the witness's bias such as:
    • Animosity toward defendant
    • Animosity toward a group of which the defendant is a member or with which the defendant is affiliated
    • Relationship with victim
    • Known but uncharged criminal conduct (that may provide an incentive to curry favor with a prosecutor)

  • Prior acts under Fed.R.Evid. 608
  • Prior convictions under Fed.R.Evid. 609
  • Known substance abuse or mental health issues or other issues that could affect the witness's ability to perceive and recall events
See Giglio v. United States, 405 U.S. 150 (1972).

Defense counsel may be remembering that notes of witness statements may be very crucial (and they may be wrong!).   Consider that Martha Stewart went to prison based largely upon evidence consisting of an agent's notes of Stewart's comments.   With those thoughts in mind, check out the following also in the aforementioned paragraph 7:

a. Witness Statement Variations and the Duty to Disclose: Some witnesses' statements will vary during the course of an interview or investigation. For example, they may initially deny involvement in criminal activity, and the information they provide may broaden or change considerably over the course of time, especially if there are a series of debriefings that occur over several days or weeks. Material variances in a witness's statements should be memorialized, even if they are within the same interview, and they should be provided to the defense as Giglio information.
b. Trial Preparation Meetings with Witnesses: Trial preparation meetings with witnesses generally need not be memorialized. However, prosecutors should be particularly attuned to new or inconsistent information disclosed by the witness during a pre-trial witness preparation session. New information that is exculpatory or impeachment information should be disclosed consistent with the provisions of USAM §9-5.001 even if the information is first disclosed in a witness preparation session. Similarly, if the new information represents a variance from the witness's prior statements, prosecutors should consider whether memorialization and disclosure is necessary consistent with the provisions of subparagraph (a) above.
c. Agent Notes: Agent notes should be reviewed if there is a reason to believe that the notes are materially different from the memorandum, if a written memorandum was not prepared, if the precise words used by the witness are significant, or if the witness disputes the agent's account of the interview. Prosecutors should pay particular attention to agent notes generated during an interview of the defendant or an individual whose statement may be attributed to a corporate defendant. Such notes may contain information that must be disclosed pursuant to Fed.R.Crim.P. 16(a)(1)(A)-(C) or may themselves be discoverable under Fed.R.Crim.P. 16(a)(1)(B). See, e.g., United States v. Clark, 385 F.3d 609, 619-20 (6th Cir. 2004) and United States v. Vallee, 380 F.Supp.2d 11, 12-14 (D. Mass. 2005).

It may be interesting to see whether these disclosure "reminders" -- because the "obligations" do not change -- have any impact on any of the numerous criminal cases and ongoing investigations of countless others.   Every large investigation -- such as the UBS tax evasion case, the Galleon hedge fund insider trading case, even the David Rothstein and Bernard Madoff "Ponzi" cases -- may be affected.  

Eric Dixon is a practicing attorney in New York and New Jersey, in addition to commenting regularly on Crime, Politics and Policy.   Mr. Dixon has engaged in complex investigations and research involving financial institutions and political figures.   Mr. Dixon does not represent anyone or have any connection to anyone mentioned or involved in any of the cases cited here. 

Mr. Dixon engages in select legal, economic and legislative analysis for clients on a professional, fee-for-service basis. Inquiries of Mr. Dixon may be directed to and by phone at 917-696-2442.  

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