Opinion
NO. 1:06-CR-00111.
December 27, 2007
OPINION AND ORDER
This matter is before the Court on a number of pending motions: Defendants' Motion for Reconsideration (doc. 230), the Defendants' Supplement to Motion (doc. 232), the government's Response (doc. 240), and Defendants' Reply (doc. 263); the government's Motion to Consider Disqualification of Defense Counsel (doc. 242), Wende Cross's Response in Opposition (doc. 256), and the government's Reply (doc. 266); Greg J. Cossman's Motion to Quash Subpoena Duces Tecum Issued by Defendants (doc. 244), Defendants' Response in Opposition (doc. 257), and Cossman's Reply (doc. 261).
Also before the Court is Defendants' Response in Opposition to the government's Motion in Limine for a Determination that Records Qualify as Business Records Under Federal Rule of Evidence 803(b) (doc. 254), and the government's Reply (doc. 262). Finally, the government moves the Court to enter an Order, that absent specific objections it shall consider the Supplement to its Motion in Limine as admissible business records (doc. 234).
For the reasons indicated herein, the Court DENIES Defendants' Motion for Reconsideration, GRANTS the government's Motion to Disqualify, DISQUALIFIES Wende Cross from serving as Defense Counsel in this matter, GRANTS Greg Cossman's Motion to Quash, DENIES Defendants' objections to the government's liminal motion, and GRANTS the government's Motion to Supplement its Motion in Limine.
The Court addresses the Motions seriatum:
I. Defendants' Motion for Reconsideration (doc. 230)
The Court held a two-day "Kastigar-like" hearing in late September, 2007, in its consideration of Defendants' Corrected Joint Motion to Bar the Government from Using the Evidence Obtained in Violation of the Defendants' Attorney-Client and Work Product Privileges and to Dismiss the Indictment Since Privileged Material Was Used to Secure it (doc. 225). The Court found the agent testimony credible that they did not use or rely on privileged information in their investigation, concluded that Defendants' motion lacked merit and denied it (Id.).
Defendants bring the instant motion, requesting the Court reconsider its denial of the Corrected Joint Motion, on the basis that new evidence has come to light that impeaches the agent testimony upon which the Court relied (docs. 230, 232). Specifically, Defendants argue that the absence of transmittal letters between Agent Almaguer in Cincinnati and Inspector McGowan in Pittsburgh constitutes evidence that the screening of NuVox emails never took place (doc. 230). Next, Defendants argue that the government's failure to produce the NuVox emails that were screened out is also new evidence showing that Almaguer was lying about having conducted the privilege screening (Id.). Defendants further argue that the existence of documentation related to the second NuVox screening, as described in a conversation with AUSA Mark D'Alessandro, shows the first NuVox screening never occurred, for lack of transmittal letters (doc. 232). Next, Defendants reiterate their theory that Almaguer's possession of NuVox emails shows he must have used them (doc. 230), and argue that the time gap between the submission of the first and second set of NuVox emails to McGowan shows McGowan never screened the first set of emails (doc. 232). Finally, Defendants question the disposition of 4,470 emails screened out of the second Nuvox production, and contend the government has failed to produce the full universe of NuVox emails as well as the specific emails screened out as privileged (Id.).
The government responds that none of the Defendants' proffered arguments concerning new evidence have merit, as none of their contentions constitute new evidence (doc. 240). The government argues the Court properly found Almaguer's testimony fully credible, and that Defendants' motion is premised on new speculation, rather than on new evidence (Id.). The government further contends that the Court already determined that the lack of transmittal letters and other chain of custody documents bore little or no relationship to the credibility of the testifying agents (Id.). The Court, argues the government, also already rejected the theory that because Almaguer possessed privileged NuVox emails, he must have used them (Id.).
As for Defendants' argument regarding the passage of time between the two submissions of NuVox emails to McGowan, the government argues McGowan's Declaration that he processed both submissions within a ninety-day window establishes that he screened the first submission (Id.). The government argues that because none of the 4,470 emails screened out of the second NuVox production were ever released to the investigation team, they clearly could not have been used to further the investigation (Id.). Finally, the government submits that it produced the full universe of NuVox emails in October 2006, and that the prosecution has no obligation to identify emails it considers to be privileged (Id.).
Defendants argue in reply that the government fails to refute their positions, and leaves their central contentions unanswered (doc. 263). The Court disagrees. Defendants have offered no basis for the Court to revisit its credibility determination of the agent testimony offered at the Kastigar-like hearing. The Court finds the government's argument and position well-taken in all respects. Defendants' central contentions are premised on speculation, and the government has more than adequately answered. Therefore, the Court will not reconsider its decision denying Defendants' Corrected Joint Motion (doc. 116).
II. The Government's Motion to Disqualify Defense Counsel (doc. 242)
The government moves the Court to disqualify attorney Wende Cross, ("Cross"), who entered an appearance on behalf of Defendant Steven Warshak, on November 28, 2007 (doc. 235). The government submits that because Cross acted as Counsel for twelve Grand Jury witnesses, several of whom implicated Warshak in the alleged fraud scheme of this case, Cross's prior representation creates the potential for conflicted interests (doc. 242). The government submits that the privileged nature of Cross's communications with her prior clients places in question her ability to represent Warshak to her fullest potential, in that she may have information material to her representation of Warshak that she would be prohibited from disclosing (Id.). Even should Cross not be called upon to cross-examine any of her former clients, the government argues such a tactic does nothing to fix the underlying conflict created by her prior representation of the Grand Jury witnesses (Id.). Citing United States v. Yates, No. CR-3-99-040(6), 1999 WL 1485774 at *2 (S.D. Ohio July 16, 1999) (citing Wheat v. United States, 486 U.S. 153, 159 (1988)), the government submits that because the Sixth Amendment guarantees an effective advocate and not necessarily one specifically preferred by a Defendant, the right to select counsel of one's choice is a qualified right (Id.). As such, argues the government, an attorney with personal and professional conflicts could be hindered in effectively advocating in her client's behalf, which is the concern of the Sixth Amendment (Id.). Several Circuits, including the Sixth Circuit in United States v. Mays, 69 F.3d 116, 121-22 (6th Cir. 1995), have upheld the disqualification of counsel based on conflicts of interest (Id. citing United States v. Lanoue, 137 F.3d 656, 663-64 (1st Cir. 1998), United States v. Moscony, 927 F.2d 742, 750-51 (3d Cir. 1991)).
Cross responds that only three of her former clients will be called to offer testimony, all three are merely fact witnesses, unlike those in Wheat or Mays none of them are co-Defendants, and all are current Berkeley employees (doc. 256). This case, she argues, resembles U.S. v. Cunningham, 672 F.2d 1064 (2d Cir. 1982), in which the court rejected the disqualification of defense counsel who represented a witness in a related case, because the Defendant's interest in retaining counsel of his choice outweighed the government's interest in disqualifying the attorney (Id.). Cross argues that she only met with two of these three former clients for a brief time to prepare them for their Grand Jury testimony (Id.). As for the third, Mr. Fricke, she contends she only served to file documents as local counsel in a civil matter (Id.). Cross attaches waivers from Defendant Warshak and her former clients, in which they have all signed consent letters stating they waive any potential conflict (Id.). Cross argues that as she can forgo cross-examination of the witnesses, there is an adequate remedy for any potential conflict (Id.). Cross concludes that, in her view, the government has failed to provide adequate reasons to overcome the presumption in favor of having Warshak represented by counsel of his choice (Id.).
The government replies that Warshak's Sixth Amendment interest in retaining Cross is relatively low because she enters the case virtually on the eve of trial, and because Warshak clearly already has an highly-skilled attorney, as well as a team of lawyers working on a consolidated defense (doc. 266). The government argues that Warshak's waiver of conflict-free counsel cannot overcome the potential threat to the integrity of the trial posed by Cross's participation (Id.). The government argues that Cross's reliance on Cunningham, 672 F.2d 1064, is questionable under the later decision in United States ex rel. Stewart v. Kelly, 870 F.2d 854, 857 (2d Cir. 1989) (questioning whether "Cunningham retains any force in light of the subsequent holding in Wheat"). In the government's view, this case is closer to the facts of United States v. Iorizzo, 786 F.2d 52 (2d Cir. 1986), where the Court reversed a defendant's conviction based on a conflict of interest where his lawyer had represented one of the witnesses against the defendant (Id.). In Iorizzo, the Court noted its concern that the attorney's first-hand involvement with the witness's testimony would cause any argument to the jury about that testimony to be a statement of a witness, as well as an advocate (Id. citing 786 F.2d at 57). Further, the government argues that as Cross is entering the case at such a late date, it would be nearly impossible for her to segregate what she learned from privileged communications with the witnesses from communications she would have with Warshak (Id.). As Cross will be working closely with co-counsel, the government contends the mere fact she will refrain from cross-examining her former clients does nothing to limit potential conflicts (Id.).
In addition, the government argues that Cross's prior representation gave her access to nonpublic information that she could use for the benefit of her new client, Warshak (Id.). Because Cross gained such information by the fortuity of her involvement during the Grand Jury phase, the government argues the nonpublic information she gained has the real threat of undermining the integrity of these proceedings (Id. citing United States v. Ostrer, 597 F.2d 337, 339-40 (2d cir. 1979) ("allowing an attorney to represent a client in a situation where he may use information obtained in the course of the former representation of the client's adversary gives the client an 'unfair advantage'"). Finally, the government argues the Court should disregard the unsworn waivers submitted by Cross's former clients (Id.). The government contends the fact that all of the waivers come from current Berkeley employees should cast doubt over whether the waivers were truly knowing and voluntary (Id.). The government critiques the signatures on several of the waivers as illegible, notes that none make any mention of the attorney-client privilege, and argues that because the language in all of the waivers is substantially identical, they were written at the instruction of a third party (Id.).
The Court recognizes a presumption in favor of Defendant's counsel of choice. Serra v. Michigan Dept. of Corrections, 4 F.3d 1348, 1354 (6th Cir. 1993). However, that presumption can be overcome by either a showing of actual conflict or a showing of serious potential for conflict. Id. The Court possesses wide latitude in evaluating the facts and circumstances under this standard. Id. citing Wheat v. United States, 486 U.S. 153, 166 (1988).
Having reviewed this matter, the Court concludes that its concerns, as expressed in the final pretrial conference, at which Cross made her first appearance before this Court in this matter, have not been abated. The Court is troubled by Cross's late entry into the case, when Warshak clearly already has exceedingly competent counsel, and Cross's entry brings the serious potential for unnecessary conflicts. The Court has carefully considered Cross's arguments which minimize the nature of her contact with the three witnesses, and which simply propose that she refrain from their cross-examination. The balance tips in favor of the government, however, due to the Court's concerns about Cross's prior access to nonpublic information, her current representation for Ronald Fricke, in the related stayed civil case, Warshak v. United States, Case No. 1:06-CV-00357 , and the Court's doubts about the nature of the waivers of Cross's former (and current) clients. The Court does not know what Cross discussed with her former clients, or what information was disclosed, and such discussions qualify as attorney-client communications. The waivers here do not make any mention of communications protected by the attorney-client privilege.
In the stayed civil case, Cross argued for the intervention of her client Fricke on the basis that it was "unlikely that the existing Plaintiff Warshak will adequately represent Fricke's interests." Fricke and Warshak have distinct interests in both cases as evidenced by Cross's own filing.
The Court has little doubt that Cross's earlier representation of twelve witnesses in the Grand Jury proceedings was related to her current representation of Warshak. Moreover, the Court finds well-taken the government's argument that Cross's representation of those twelve witnesses, whose testimony may have contributed to Warshak's indictment, falls most closely in line with that at issue in United States of America v. Mays, 69 F.3d 116 (6th Cir. 1995). In Mays, the Sixth Circuit noted the potential of conflicts of interest "not solely to [the] defendant . . . but to several others involved in the case" where the attorney had represented seven witnesses before the grand jury as well as two co-Defendants." 69 F.3d at 122. In conclusion, the Court finds the government has made a serious showing of potential for conflict justifying the disqualification of Warshak's counsel, Wende Cross.
III. Greg Cossman's Motion to Quash Subpoena Duces Tecum Issued by-Defendants (doc. 244)
Greg Cossman brings his Motion to Quash in response to a subpoena issued by Defendant Steven Warshak's attorney Robert Goldstein (doc. 244). The subpoena requires Cossman to appear on January 8, 2008, the first day of trial, and commands him to bring "the hard drives of any and all computers that have been in your possession since March 16, 2005" (Id.). Cossman argues the command is overbroad, unreasonable, and oppressive (Id.). CitingUnited States v. Nixon, 418 U.S. 683, 693 (1974), Cossman argues that Federal Rule of Criminal Procedure 17 is not intended to be a discovery device (Id.).
Defendants respond arguing that what they are really requesting is a range of non-privileged communications relating to 1) Berkeley or any related company, 2) Cossman's employment with BPN or any related company, 3) present or former employees of colleagues at BPN or any related company, 4) Cossman's plea agreement with the government, 5) Cossman's motive or bias in favor of any relevant party or witness, 6) Cossman's innocence or guilt of any charged conduct, and 7) the upcoming trial (doc. 257). Defendants argue this requested information is relevant to charges in the indictment and they "have good reason to believe the hard drives will also contain evidence to impeach Cossman's testimony" (Id.). They also state "If Mr. Cossman's hard drives and emails on those hard drives contain evidence of promises, rewards and/or inducements given in return for his cooperation with the Government, they should be produced" (Id.). Defendants argue the subpoena is not overbroad or burdensome because they can use their own expert, using search terms agreed to by the parties, to conduct the search of the hard drives (Id.).
Cossman replies that the defense has failed to establish the specific documents it needs, has failed to establish why it could not procure the documents through other means, and is engaged in an improper fishing expedition (doc. 261). Cossman argues if the defense is seeking emails from Cossman to Berkeley, Berkeley has other means to access them, by searching its own hard drives or issuing subpoenas to its own internet service/electronic mail providers (Id.).
Having reviewed this matter, the Court agrees that Defendants are engaged in a fishing expedition and the subpoena in question is overbroad. The record shows Cossman turned his Berkeley computer over to Berkeley counsel in September 2006 and he no longer has any Berkeley computer in his possession (doc. 261). Defendants' argument is nothing but speculation that Cossman's other computers may have evidence of promises from the government to Cossman in exchange for his cooperation. The Court finds the subpoena unreasonable and therefore grants Cossman's motion to quash. Fed.R.Crim.P. 17(c)(2).
IV. The Government's Motion in Limine
In the Court's November 13, 2007 Order, it conditionally granted the government's Motion in Limine for a Determination that Records Qualify as Business Records Under Federal Rule of Evidence 803(b), (doc. 168), so as to permit Defendants until December 14, 2007 to review the records and file any objections (doc. 226). Defendants now file a Response in Opposition (doc. 254), to which the government has replied (doc. 262).
Defendants' Response is premised on the theory that the certification of the business records by their various custodians is barred by the Confrontation Clause, as interpreted by the Supreme Court in Crawford v. Washington, 541 U.S. 36 (2004) (doc. 254). In Defendants' view the certifications are testimonial, and therefore Defendants should have the right to confront the live testimony of the custodians (Id.).
In its Reply, the government acknowledges that the Sixth Circuit has yet to address the specific question of whether certifications of business records, like the records themselves, are non-testimonial (doc. 262). However, the government submits that several other courts have done so. (Id. citing United States v. Ellis, 460 F.3d 920, 927 (7th Cir. 2006), United States v. Bryant, No. 3:04-CR-00047-01, 2006 WL 1700107, at *4 (W.D.Va. June 15, 2006), United States v. Weiland, 420 F.3d 1062, 1077 (9th Cir. 2005)). In any event, the government argues that the certification itself only relates to the admissibility of the records, and not any fact in issue (Id.). Because the Court makes determinations of admissibility, the certifications never reach the jury (Id. citing Fed.R.Evid. 104(a)). Therefore, argues the government, the concern raised in Crawford that the accused not be convicted based on untested out-of-court statements is inapplicable to the certification of business records (Id.).
Having reviewed this matter, the Court agrees with the government that Defendants' Confrontation Clause objection lacks merit in relation to certifications of custodians of business records. The Court finds persuasive the holding in United States v. Ellis, that "the written certification entered into evidence pursuant to Rule 902(11) is nontestimonial just as the underlying business record are. Both of these pieces of evidence are too far removed from the 'principal evil at which the Confrontation Clause was directed' to be considered testimonial." 460 F. 3d 920, 927, quoting Crawford, 541 U.S. at 50.
V. The Government's Supplement to Its Motion in Limine
Finally, as a related matter, the government moves to Supplement its Motion in Limine with additional business record certifications (doc. 234). The government requests that similarly to the Court's November 13, 2007 Order, the Court consider these supplemental records as admissible business records absent any specific objections by Defendants (doc. 234). Defendants have been able to review the government's Supplement, which it filed more than one month ago. The Court notes no objections on the docket, beyond those arguments rejected above. Accordingly, having reviewed the records in question, the Court finds it appropriate to consider them as admissible business records.
VI. Conclusion
Having reviewed the above-pending motions, the Court DENIES Defendants' Motion for Reconsideration (doc. 230), GRANTS the governments' Motion to Disqualify Defense Counsel (doc. 242), and DISQUALIFIES Wende Cross from serving as defense counsel in this matter. The Court also GRANTS Greg J. Cossman's Motion to Quash Subpoena Duces Tecum Issued by Defendants (doc. 244), UNCONDITIONALLY GRANTS the government's Motion in Limine (doc. 168) and GRANTS the government's Motion to Supplement its Motion in Limine (doc. 234).
SO ORDERED.