Opinion
No. C 03-02398 TEH.
July 8, 2004
ORDER GRANTING RESPONDENT'S FOURTH REQUEST TO PURGE CONTEMPT
The Court is in receipt of Respondent's Fourth Request to Purge Contempt, Petitioners' response (captioned a reply), and Respondent's reply, along with the parties' respective declarations and exhibits. Having carefully considered all of these materials, and the record herein, the Court concludes that Respondent has purged his contempt, and that the government has not met its burden of demonstrating that Respondent should remain in custody. Accordingly, Respondent's request shall be granted.
DISCUSSION
As a result of this Court's order granting the government's motion for civil contempt, Respondent has been in custody since May 10, 2004, in order to induce his compliance with IRS summonses. The summonses required Respondent to provide personal and business financial records and to provide testimony regarding these records. The government argues that the Court should deny Respondent's request and retain Respondent in custody because (1) he has not yet provided all the summonsed documents and (2) he has given non-credible answers to some questions. Each issue is discussed in turn. Summonsed Documents
Since his incarceration, Respondent has, through counsel, subpoenaed from Wells Fargo Bank all personal and business records from 1989 to the present (going beyond the documents sought by the summonses), and has produced to the government all of the records provided by Wells Fargo Bank. See also Ignes Decl. (regarding Washington Mutual Bank's lack of records). Although the documents Wells Fargo Bank was able to produce do not cover the entire period of the summonses, the government has failed to make any showing that, as this point, Respondent is withholding documents within his possession or constructive possession, or that continued confinement could possibly lead to the production of additional records.
Summonsed Testimony
When Respondent filed his prior three requests for release, he had neither obtained his financial records from Wells Fargo Bank nor provided testimony regarding such records. In denying these requests, the Court explained that it was persuaded that continued confinement was necessary to ensure that Respondent would in fact promptly produce the summonsed documents and provide testimony regarding the documents. Now, the available records have been produced, and Respondent has provided several hours of testimony regarding them on two occasions: June 15, 2004, and June 22, 2004. (He also was deposed on May 20, 2004 prior to the production of records from Wells Fargo).
The government contends, however, that Respondent should remain in custody because he has falsely claimed a lack of memory in response to some questions. The government relies on Battaglia v. United States, 653 F.2d 419 (9th Cir. 1981), which held that false assertion of memory loss could constitute a refusal to testify within the meaning of the recalcitrant witness statute, 28 U.S.C. § 1826, and thus could be grounds for confinement of a grand jury witness. The Ninth Circuit remanded the matter to the district court, however, because it had improperly placed the burden of proof upon the witness instead of the government.
Indeed, Battaglia implicitly recognizes that maintaining a witness in custody because the government does not believe she or he is being truthful is an extreme remedy, and thus should only be invoked if the government meets certain burdens — burdens which the government has glossed over in this case. Under Battaglia, the government should have (1) identified the specific questions it contends were falsely answered (2) demonstrated that each such question was authorized and relevant to the proceedings, and (3) established that the information was not already in the possession of the government. Further, where as here the allegedly false answers were "I don't remember," the government must show by "clear and convincing evidence," that the claimed inability to remember the information at issue is not credible. Id. at 422-423. In discussing the government's failure to meet this standard in Battaglia, the Court noted that the government had not, for example, shown that Battaglia had recently discussed with others the events that he told the grand jury he could not recall. Nor had the government shown that medications Battaglia was taking do not in fact affect long-term memory as he had claimed. Id. at 423.
Here, the government has not met its burdens under Battaglia. First, while the government discusses some of the questions and answers in general terms, the government fails to (1) identify the specific questions at issue, (2) demonstrate that each such question was authorized and relevant to the proceedings, or (3) demonstrate that the specific information sought was not already in the possession of the government.
Second, the government fails to show by "clear and convincing evidence" that the claimed inability to recall the answer to each such question was not credible. For example, the government complains that the Respondent failed to recall all of the names, addresses, and phone numbers of donors to the church, religious groups he has spoken to, or persons who asked him to speak. It is unclear, however, why the government would expect Respondent to recall exact addresses and phone numbers. With respect to the names of people, the government fails to provide important facts such as when any of these events occurred. Clearly a failure to recall a name from a recent event is less credible than a failure to recall a name from an event arising months or years ago.
The government argues that Respondent's inability to recall names, addresses, and phone numbers should be found not credible "in light of his false claim that he sent materials and money to attorneys who do not exist." Respondent's Reply at 4. This argument is based on the fact that although Respondent identified two persons (John Franklin in Kansas City, and Cal Avila in Sacramento) as being attorneys with whom he had contact, the government could not, based on an internet search, confirm the existence of attorneys with those names in those locations. It is possible, however, that either those persons are no longer at those locations or that they are not in fact attorneys although Respondent believes that they are attorneys. In short, this one internet search simply does not provide "clear and convincing evidence" that Respondent's claimed inability to remember various names, addresses, and phone numbers is false.
In another effort to demonstrate that Respondent's lack of memory is false, the government attempted to follow up on Respondent's deposition testimony that he and others gathered for church meetings at the Blackhawk Restaurant, including the President of the Blackhawk Homeowners Association, who Respondent identified by the name "Ray." According to a declaration filed by the government, it learned through an internet search that the current President of the Blackhawk Homeowners Association is named Michael Marchi, that a government law clerk spoke to Mr. Marchi, and that Mr. Marchi denied knowing anyone by the name of Lawrence Williams. See De Haan Decl. This declaration proves little since (1) the Respondent's name is Joseph, not Lawrence, Williams, and (2) the government fails to demonstrate that Mr. Marchi was the President of the Blackhawk Homeowners Association at the time of the alleged church meetings which, according to Respondent's papers, occurred over one year ago.
It is certainly possible that Respondent has not answered every question truthfully. The government, however, has fallen far short of meeting its heavy burden of demonstrating that this Court should continue to confine Respondent in prison in order to coerce different answers to certain questions. Nor would it be appropriate for the government to use the occasion of these contempt proceedings to gather information for purposes of its case against Joe Little. With respect to the debt expungement scheme, the government is of course free to pursue an investigation of this matter irrespective of these proceedings.
CONCLUSION
In light of all of the above, and good cause appearing, the Court hereby finds that the government has not demonstrated that Respondent is in continued contempt of this Court's order enforcing summonses. Rather, the Court concludes that Respondent has sufficiently purged his contempt. Accordingly, Respondent shall be released from custody, effective immediately.
The Clerk is directed to close the file.