Opinion
NO. 1:06-CR-00111.
December 13, 2007
OPINION AND ORDER
This matter is before the Court on Defendants' Omnibus Pretrial Motion (doc. 171), the government's Response (doc. 192), Defendants' Reply (doc. 209), the government's Supplemental Response (doc. 223), and the Defendants' Reply to the Supplemental Response (doc. 224). For the reasons indicated herein, the Court DENIES Defendants' motion in all respects.
I. Background
Defendants Steven Warshak ("Warshak"), Harriet Warshak, Paul Kellogg, Steven Pugh, Amar Chavan, TCI Media, Inc., and Berkeley Premium Nutraceuticals, Inc. ("Berkeley") bring their current set of motions — involving some seventeen different issues, in a nearly three-hundred page document styled "Omnibus Pretrial Motions" (hereinafter, "Omnibus Motion"). The Omnibus Motion attacks under various theories the propriety of the government's investigation which led to the September 20, 2006 Indictment, which alleges the Defendants engaged in a conspiracy to commit mail, wire and bank fraud, illegally charged consumer credit cards, made false statements to banks, engaged in money laundering, conspired to misbrand products, and conspired to obstruct Food and Drug Administration and Federal Trade Commission proceedings. Defendants argue in their Omnibus Motion that "when the alarming number of investigative illegalities are aggregated . . . the most appropriate judicial remedy is dismissal" (doc. 171). The government responds in opposition, arguing that no portion of Defendants' Omnibus Motion has merit, and the Court should deny it in its entirety (doc. 192).
Because the Court has recounted the time-line of the government's investigation in its Order on the Kastigar-like hearing (doc. 225), the Court will not reiterate it here in detail, but incorporates those facts by reference. The Court notes, however, that the government initiated its criminal investigation in January 2004, executed search warrants on March 16, 2005, and later obtained cooperation from high-level employees from inside the company. The Court takes judicial notice that five of those employees, Defendants in the related criminal cases, United States v. Greg J. Cossman, No. 1:06-CR-00014, United States v. Michael V. Wagner, No. 1:06-CR-00015, United States v. James G. Teegarden, Jr., No. 1:06-CR-00016, United States v. Susan Cossman, 1:06-CR-00017, andUnited States v. Shelley B. Kinmon, 1:06-CR-00028, all entered pleas of guilty before this Court in early 2006 for violation of 18 U.S.C. 1349, that is, for conspiracy to commit mail and wire fraud. Each Defendant signed off on a statement of facts outlining a conspiracy to obtain money from consumers by false and fraudulent representations in connection with the sale of Berkeley products. These high-level Berkeley employees stated that consumers were defrauded of in excess of one-hundred million dollars, through various schemes, including the charging of credit cards without consumer authorization and the making of material false representations in advertising. They also described a scheme under which sales staff were instructed to make material misrepresentations to consumers. Finally, they stated that to cover up the fraud, Berkeley used methods to inflate the number of sales transactions. They explained that by dividing up the billing of individual transactions, Berkeley caused the corresponding ratio of credit card chargebacks to appear lower than it was in actuality. In this way, the number of refunds sought by consumers would appear smaller in relation to an inflated number of overall transactions. The government has represented that each of these Defendants — including Steven Warshak's sister Susan Cossman — are ready to cooperate in this matter, so as to testify as to the involvement of Steven Warshak and other Defendants in directing or otherwise participating in the alleged conspiracy and other acts charged in the 112-Count Indictment.
II. Defendants' Omnibus Motion
The Court addresses Defendants' Omnibus Motion arguments, seriatum.
A. Defendants' Request for a Franks Hearing.
Defendants argue that the government's leading case agent, Alejandro Almaguer, was "out of control" in allegedly making false statements in affidavits supporting the warrants to search Defendants' property, such that the Court should conduct an evidentiary hearing under Franks v. Delaware, 438 U.S. 154 (1978). Under Franks, "where the defendant makes a substantial preliminary showing that a false statement knowingly and intentionally, or with reckless disregard for the truth, was included by the affiant in the warrant affidavit, and if the allegedly false statement is necessary to the finding of probable cause," at Defendant's request, the Court must hold a hearing to determine if such allegations are established by a preponderance of the evidence. 438 U.S. at 155-56. Should this be the case, the Court must set aside the false material in the affidavit, and if the remaining content is insufficient to establish probable cause, the search warrant must be voided, and the fruits of the search must be excluded. Id. at 156.
In their motion Defendants proceed through a laundry list of omissions of facts that in their view, puts the allegations against them into context, shows their business practices were reasonable, and eliminates the finding of probable cause (doc. 171). The basic crux of Defendants' argument is that Almaguer's assertions in his affidavit concerning the number of complaints to the Better Business Bureau ("BBB"), the number of returned pieces of mail, and the number of credit card chargebacks, created a skewed impression because Berkeley had at least three million customers such that the numbers, though seemingly large on their face, were in fact statistically insignificant and within industry norms (Id.). Moreover, Defendants argue Almaguer used stale information that failed to reflect the drastic reduction in chargebacks as a result of their extraordinary efforts to rectify the civil and regulatory problems "which had resulted from [Berkeley's] phenomenal and rapid growth" (Id.). Defendants argue that virtually every major American corporation would be subject to prosecution if based on the same factors, and cite the number of BBB complaints lodged against Sprint, Dell, T-Mobile, AOL, and Verizon Wireless (doc 209). Defendants contend the Court should not defer to the Magistrate Judge's decision to issue the warrant, because in their view, Almaguer misled the Magistrate Judge with half-truths and omissions (Id.).
Defendants, despite protesting the government's failure to put the numbers within context, fail to put their own numbers in context, and recite the BBB complaints filed as to each company without referencing the proportional number of customers or business transactions for these comparative enterprises.
The government responds that Defendants have not overcome the presumptive validity of the search warrant affidavit, and citingMays v. Dayton, 134 F.3d 809 (6th Cir. 1998), argues that Franks is only very rarely applicable where there is an alleged omission of facts (doc. 192). The government argues Defendants' characterization that they implemented extraordinary measures to rectify problems with credit card chargebacks really means little because VISA forced Defendants to make the changes (Id.). The government further argues that Defendants' statistical arguments do not add up because billing people's credit cards without authorization, massive product returns and a high volume of chargebacks and BBB complaints justifies the issuance of a warrant (Id.). Overall, argues the government, Defendants' motion is characterized by piecemeal attacks on Almaguer's affidavit so as to avoid its cumulative, cohesive reading (Id.). In the government's view, the Magistrate Judge understood the twenty-two page document with sixty-five paragraphs, and had a substantial basis for concluding that probable cause existed (Id. citing Illinois v. Gates, 462 U.S. 213 (1983)).
Having reviewed this matter, the Court finds the government's position well-taken as to Defendants' request for a Franks hearing. Defendants have not made the requisite substantial preliminary showing that Almaguer included a false statement in his affidavit, knowingly and intentionally, or with reckless disregard for the truth. Defendants have attempted to show Almaguer made omissions such that his statements constituted half-truths. The Court, however, finds well-taken the government's view that this case falls within the scope of Mays v. Dayton, 134 F.3d 809, 816 (6th Cir. 1988), such that the alleged omissions were not critical to the finding of probable cause, and therefore, Franks is inapplicable.
Even should the Court accept the various claims by Defendants that the chargeback problems and BBB complaints were statistically insignificant, that Berkeley's packaging of their products was legal, and that Berkeley's "auto-ship" program is a normal business practice, the Court finds the bottom line is that Almaguer based his affidavit on facts that Defendants can attempt to minimize, but which nonetheless provide probable cause for a search of Berkeley's facilities. The fact of the matter is Almaguer had reports from consumers that their credit cards were charged by Defendants, without the consumers' authorization, and he had reports from former Berkeley employees that Berkeley instructed them not to tell consumers about their automatic enrollment into the "auto-ship" program. These reports, of course, are within a context where thousands of pieces of mail were indisputably returned by consumers, and Almaguer had witnesses linking the returns to involuntary enrollees in the auto-ship program. Taken together, these facts were reasonably trustworthy so as to allow a reasonably prudent person to believe Defendants were violating the law, as a practice, and that a search was therefore warranted at the Berkeley premises. U.S. v. Eisner, 297 F.2d 595, 596 (6th Cir.), cert. denied 369 U.S. 859 (1962). The Magistrate Judge therefore had a substantial basis for finding that probable cause existed, and did not err in issuing the search warrant.
Defendants have neither shown to be false the consumer reports that their credit cards were improperly charged nor the statements of former employees about how they were instructed to not tell callers about automatic enrollment in the "auto-ship" program. Although Defendants characterize the former employees as unreliable because the employees were "disgruntled," Defendants fail to proffer any evidence that the former employees were lying about the alleged scheme.
B. Defendants' Motion to Suppress Evidence Obtained from Internet Service Providers.
Defendants further argue the Court should suppress all the evidence the government obtained from the Defendants' Internet Service Providers ("ISP's") due to the government's alleged violations of the Stored Communications Act ("SCA"), 18 U.S.C. § 2703, Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. §§ 2510 et seq. (1970) ("Title III"), and the Fourth Amendment (doc. 171). Before addressing Defendants' arguments, the Court finds two important considerations should be noted. First, the government submits that it has not and will not review any of the evidence produced by the ISP's Verio, MSNHotmail, or Yahoo!, and therefore Defendants' Motion to Suppress as to evidence obtained from these providers should be denied as moot. The Court finds the government's position well-taken, and thus will confine its analysis to the arguments pertaining to the evidence obtained from the ISP NuVox. Second, Defendants brought their challenge within the context of the Sixth Circuit's decision inWarshak v. United States, 490 F.3d 455 (6th Cir. 2007) ("Warshak I") in which the appellate court found the SCA unconstitutional to the extent that it allows compelled disclosure of email without a warrant and without prior notice to the account holder. The Court notes that the Sixth Circuit vacated "Warshak I" on October 9, 2007, and set the question for rehearing en banc.Warshak v. United States, No. 06-4092, 2007 U.S. App. LEXIS 23741, *1 (6th Cir., October 9, 2007).
The question of the constitutionality of the SCA aside, Defendants argue the government's actions neither complied with the statute, nor with Title III, and were unreasonable within the meaning of the Fourth Amendment (doc. 171). In Defendants' view, the government's alleged violations consist first of all, of its request to NuVox to preserve all of Mr. Warshak's emails (Id.). Defendants argue the government made such requests prospectively, in contravention of the SCA's Section 2703(f), which makes the preservation requirements applicable only to records already in possession of ISP's at the time the preservation request is made (Id.). Defendants contend that under the Department of Justice's own applicable guideline, prosecutors are warned if they wish to obtain future electronic communications, they must comply with the Wiretap Statute, Title III (Id. citing Computer Crime and Intellectual Property Section, Criminal Division, U.S. Department of Justice, Searching and Seizing Computers and Obtaining Electronic Evidence in Criminal Investigations, Chapter III, Section(G)(1)). Because the government did not follow its own guidelines in issuing the ISP request, Defendants argue it violated both the SCA and Title III (Id.).
Next, Defendants attack the Grand Jury Subpoena the government issued to Nuvox on January 18, 2005, arguing that it redefined the term "electronic storage" so as to eliminate the SCA's protections for emails stored less than 180 days. Defendants further argue the subpoena fails to pass muster under Warshak I as unsupported by a showing of probable cause and as lacking in particularity (Id.). Finally, Defendants attack the government's May 6, 2005 Section 2703 Order it obtained from Magistrate Judge Hogan, under the theories that the government's application was unsupported by specific facts, that the government allegedly misled the Magistrate with its redefined term "electronic storage," that Warshak I's holding found the SCA unconstitutional, and that the government failed to seek extensions of the 90-day sealing period so it should have provided notice of the Order to Defendants (Id.). In Defendants' view, the above-cited defects amount to flagrant violations of the Fourth Amendment's proscriptions against unreasonable searches and seizures. The Court, therefore, according to Defendants, should hold a hearing so as to determine the extent of the taint caused by such violations, and the scope of the exclusionary rule (Id.).
The government responds that Defendants' arguments fail because 1) all the Defendants with the exception of Steven Warshak, who is the only account holder, lack standing to bring a Fourth Amendment challenge, 2) under Illinois v. Krull, 480 U.S. 340 (1987), the exclusionary rule does not apply where the government obtains information in good faith reliance on a statute, even if the statute is later declared unconstitutional, and 3) there are no statutory suppression remedies for the violations Defendants allege (doc. 192). The government takes issue with Defendants' charge that it redefined "electronic storage," arguing the Magistrate Judge adopted its definition, which comported with the statute (Id.). The government defends its application for the NuVox 2703(d) order, in which it stated it "was investigating a large-scale mail and wire fraud operation," that NuVox held email accounts for targets of the investigation, and that current and former employees "suggest that electronic mail is a vital communication tool that has been used to perpetrate the fraudulent conduct" (Id.). In the government's view, such factual allegations met the standard for a 2703(d) order, which can be obtained on a standard lower than a probable cause warrant (Id.citing H. Rep. No. 103-827(I) at 31 (1996), reprinted in 1996 U.S.C.C.A.N. 3489, 3511.) The Magistrate Judge, therefore, contends the government, had reasonable grounds to issue his order (Id.). Finally, the government argues that its "inadvertent" delayed notice did not violate any terms of the Section 2703 Order, and in any event its error in failing to comply with the notice procedures of 18 U.S.C. § 2705(a)(4) was not a "but-for" cause of its obtaining the email, which it already had in its possession (Id.). As such, the government contends, there is no basis for suppression of such evidence (Id. Citing Hudson v. Michigan, 126 S. Ct. 2159, 2164 (2006)).
Defendants reply that the government misapplies the Krull "good faith" exception because the government violated the very statute upon which it seeks to rely for its good faith claim (doc. 209). In Defendants' view, the fact that the Sixth Circuit had "little difficulty" declaring Section 2703(d) unconstitutional in Warshak I shows the government's reliance on the Section was patently unreasonable (Id.).
Having reviewed this matter, the Court finds the government's position well-taken. As noted above, the Sixth Circuit vacated Warshak I, such that Defendants' heavy reliance on such decision now seems misplaced, or at least, in limbo. Even should the en banc rehearing result in the same or similar outcome, the Court finds well-taken the government's position that its agents here acted in good faith under the meaning of Krull, 480 U.S. at 349-50. Consistent with the government's request, (doc. 223), the Court holds the good-faith exception to the exclusionary rule applies, without ruling on the constitutionality of the SCA. The alleged violations of the SCA do not amount to unreasonable actions in violation of the Fourth Amendment. The government's prospective language in its preservation requests did not comply with the SCA or with the D.O.J.'s guidelines, and yet, such infraction does not constitute unreasonable government action in the context of the alleged large-scale mail and bank fraud case at hand. The Court agrees that neither the SCA nor Title III provide suppression remedies for evidence improperly acquired under either statute. United States v. Ferguson, 508 F. Supp.2d 7, 10 (D.D.C. 2007), United States v. Steiger, 318 F.3d 1039, 1052 (11th Cir. 2003). Moreover, the government's failure to comply with the notice provisions does not relate to its acquisition of emails, as it submits that as of the time it should have sought to extend delayed notice, it already had the email in its possession. The Court therefore finds well-taken the government's reliance on Hudson v. Michigan, 547 U.S. 586 (2006), such that the facts here do not support a viable theory for suppression. The Court therefore rejects in entirety Defendants' motion to suppress evidence obtained from ISP's, and finds no basis for the requested "taint" hearing.
C. Defendants' Claim of the Government's Outrageous Execution of the Search Warrants on March 16, 2005.
Defendants next argue that the government conduct on March 16, 2005 in executing the search warrants of Berkeley's headquarters and other facilities was so excessive and outrageous so as to render the searches unreasonable and to justify suppression of all evidence seized during the searches (doc. 171 citing Baranski v. Fifteen Unknown Agents of the BATF, 452 F.3d at 445 (6th Cir. 2006) ("To satisfy the Reasonableness Clause, officers not only must obtain a valid warrant, but they also must conduct the search in a reasonable manner"). Defendants argue the agents' conduct on March 16, 2005 "was the antithesis of reasonable" (Id.). Defendants contend that fifty agents stormed into their corporate headquarters, with guns drawn, bearing battering rams, yelling at employees, and physically manhandling some of them (Id.). The agents ordered employees to cease all business operations, disconnected telephone calls, and "yanked off employees' headphones" (Id.). Employees were allegedly "herded, at gunpoint with their hands in the air, to the perimeter of the premises" (Id.).
Defendants argue such a dramatic execution of the search warrants was unfounded, as the search was not at the "lair of a drug kingpin or of the headquarters of an organized crime figure" but rather of an American corporation engaged in a legitimate business (Id.). Defendants further argue the unreasonableness of the searches is also demonstrated by the scope of the searches, which involved the hauling away of seven tons of documents, including entire file cabinets (Id.). Defendants proffer the affidavit of lawyer Michael Dinerman, who has conducted a review of the items seized on March 16, 2005 (Id.). Dinerman concluded that the seizure included an "astonishing breadth" of irrelevant materials including everything from feminine hygiene products, employee doodles, adoption papers, personal financial information, to a Snickers Bar (Id.). Due to the fact that the government seized such a large volume of materials, and has only reviewed a small percentage of seized materials, Defendants argue the Court should hold an evidentiary hearing and suppress all evidence seized during the March 16, 2005 searches (Id.).
The government responds that Defendants' allegations of outrageousness are feckless, and that Inspector Almaguer and other agents flatly deny breaches of etiquette or propriety (doc. 192). The government argues that this portion of the Omnibus motion is wholly meritless and should be denied (Id.). Defendants reply that the government's response is merely conclusory in fashion and highlights the necessity of an evidentiary hearing on this issue (doc. 209).
Having reviewed this matter, the Court does not find Defendants' position well-taken. Even assuming Defendants' allegations are true, the fact is that when the agents executed the warrant on March 16, 2005, time was of the essence. The Berkeley facilities are immense, and the agents were justified in quickly securing each location so as to prevent the destruction of any evidence. The fact that some employees may have been rattled by the swift, no-nonsense entry of fifty agents does not justify the suppression of evidence. Berkeley may have not been the lair of a drug kingpin, but the warrants were supported by probable cause for massive consumer fraud.
As such, the Court takes the government's representation in good faith that its agents would testify as to the propriety of their conduct in executing the warrants. Such representation is more than conclusory, as the government does more than say "the searches were reasonably executed," but indicates it has agents who will testify as much. The Court finds no hearing necessary on this question. Finally, the fact that irrelevant information and materials were swept up in the large-scale seizure here is a mere by-product of the practical reality faced by the agents who acted quickly as required so as to keep the search and seizure within the bounds of reasonableness. Surely, had the agents camped out at Berkeley and closed the operation for weeks on end, so as to sift out irrelevant information, Defendants very well may have had a basis to argue the search was conducted in an oppressive manner.
D. Alleged Facial Defects
Defendants next attack the face of the warrants and Almaguer's affidavit that supported them (doc. 171). Defendants argue the warrants authorized the seizure of an overbroad and unparticularized array of records and documents, in violation of the Fourth Amendment (Id.). Defendants reiterate here the same arguments they made in support of their request for a Franks hearing (Id.). They argue that Almaguer's affidavit is full of half-truths, that not all chargebacks are indicative of fraud, that many legitimate companies use auto-ship programs, and that Almaguer relied on stale information and upon statements of unnamed former employees whose reliability should be questioned (Id.). Defendants argue Almaguer failed to establish probable cause for misbranding violations of the Federal Food, Drug, and Cosmetic Act, ("FDCA"), 21 U.S.C. § 321, because the statements in his affidavit based on witness interviews can be viewed in conflict with sales scripts used by the company (Id.). They further argue the warrants were unreasonable in allowing the government to seize all of their computers and retain them indefinitely (Id.). For all of these reasons, Defendants argue all evidence seized on March 16, 2005, and all evidence derived therefrom, should be suppressed (Id.).
The government responds that its arguments pertaining to theFranks hearing request are equally applicable here, and that again, Defendants use piecemeal attacks to avoid a cumulative reading of Almaguer's affidavit (doc. 192). Relying on White Fabricating Co. v. United States, 903 F.2d 404, 411 (6th Cir. 1990), United States v. Blair, 214 F.3d 690, 697 (6th Cir. 2000), and United States v. Henson, 848 F.2d 1374, 1383 (6th Cir. 1988), the government argues that the degree of specificity required in a warrant is flexible, depending on the sort of crime and type of evidence to be seized (Id.). Even if the Court would find the warrant lacking in sufficient particularity, the government argues suppression would be an incorrect remedy, as there is no evidence that the warrant contained a knowing or reckless falsehood, no evidence the Magistrate Judge merely acted as a "rubber stamp," and no showing that reasonable officers executing the warrant would have found it invalid (Id. citing United States v. Leon, 468 U.S. 897, 918-21 (1984)). Finally, the government contends Almaguer's affidavit is replete with facts that indicate fraud, and his reliance on witness interviews as well as his own background, is well within the parameters of acceptable conduct (Id.).
Defendants reply, arguing the government failed to address its arguments that Almaguer did not provide the Magistrate Judge with an adequate basis to confirm the veracity of the witnesses upon which he relied (doc. 209). Defendants further argue the government failed to address their arguments concerning FDCA violations, failed to address their arguments regarding the scope of the warrants, and failed to address their specific arguments concerning overbreadth defects in the affidavit (Id.).
The Court does not find Almaguer's affidavit or the warrants that Magistrate Judge Hogan issued defective for any of the reasons Defendants advance. Indeed, "the traditional standard for review of an issuing magistrate's probable-cause determination has been that so long as the magistrate had a substantial basis for concluding that a search would uncover evidence of wrongdoing, the Fourth Amendment requires no more." Illinois v. Gates, 462 U.S. at 236 (1983). The Magistrate Judge had a substantial basis to support his conclusion that warrants should issue, based on the cumulative facts alleged in Almaguer's affidavit, which corroborated the witness statements within. Even if this was a doubtful or marginal case, which it is not, so long as the finding of probable cause is not arbitrary, the Court must uphold the Magistrate Judge's finding. United States v. Ventresca, 380 U.S. 102, 109 (1965).
The Court is unimpressed with Defendants' arguments that Almaguer failed to establish probable cause for misbranding violations. Defendants' arguments on this question rely on distinctions without any substantive differences. The fact that sales scripts differ from witness testimony proves nothing.
The Court further rejects Defendants' argument that the warrants were overbroad and unreasonable in allowing for the search and seizure of all their business computers. The seizure of all the computers was reasonable in the specific circumstances of this case, where the agents could not know which computers might contain evidence, but where they had a reliable belief that the alleged fraud scheme reached the entire operation. United States v. Logan, 250 F.3d 350, 365 (6th Cir. 2001). It is further reasonable for the government to sort through extensive files, off site, to locate relevant evidence. Guest v. Lewis, 225 F.3d 325, 334-35 (6th Cir. 2001). The Court concludes that Defendants' facial attack on the validity of the warrants or the affidavit fails in all respects. The warrants here were facially adequate so as to reasonably be presumed valid. United States v. McPhearson, 469 F.3d 518, 525 (6th Cir. 2006).
Defendants preface their arguments with authorities standing for the proposition that corporations and businesses have the right to be free of illegal searches and seizures, and that all of the Defendants had reasonable expectations of privacy in their offices and work areas. The Court notes that the reasonable expectation of privacy in a business premises is less than the expectation of privacy in a home. Minnesota v. Carter, 525 U.S. 83, 90 (1998).
E. The Evidence from Laptops of Cooperating Witnesses
Defendants argue all the evidence the government obtained from searches of laptops belonging to Berkeley, which were turned over to the government by present or former employees, must be suppressed (doc. 171). Defendants argue the laptops remained Berkeley property, the data they contained was subject to confidentiality agreements signed by the employees, and some of the information was covered by attorney-client privilege (Id.). Berkeley and Warshak argue they had a reasonable expectation of privacy in the laptops and their contents based on company practice, as evidenced by the affidavit of Ronnie Patton, Berkeley's Computer Network Administrator (Id.). Defendants argue that the surrender of the laptops was the direct fruit of the March 16, 2005 searches, that the witnesses were acting as government agents, and that the searches cannot be justified under a consent theory (Id.). Defendants argue the witnesses did not have actual authority to consent to searches of the laptops, and government agents could not have reasonably believed they had apparent authority (Id.).
The government responds that there is no Fourth Amendment protection as to the evidence obtained from the Berkeley laptops because neither Berkeley nor Warshak had an actual subjective expectation of privacy in the laptops (doc. 192). Moreover, argues the government, the cooperators provided valid consent based on their mutual, if not exclusive use of the laptops (Id.). The government proffers a consent form signed by Jim Teegarden, and represents that it can proffer testimony that Mike Wagner and Shelley Kinmon each gave valid consent to search their laptops (Id.).
Defendants reply the fact that Teegarden, Kinmon, and Wagner had possession of their laptops after the criminal investigation had begun does not show they had the ability to consent to searches of their laptops (doc. 209). Defendants argue all three were employed by Berkeley at the time they gave the government access to Berkeley computers, and all three were subject to confidentiality agreements (Id.). As such, Defendants contend, Berkeley and Warshak maintained a reasonable expectation of privacy in the laptops at issue, and the cooperators were not authorized to turn them over to the government (Id.).
The Court finds itself again on the side of the government. The Court sees no convincing evidence the cooperating witnesses were acting as anything more than private individuals in turning over evidence to the government. Even should the cooperating witnesses qualify as "agents," such that the Fourth Amendment applies, the Court finds no real question that they voluntarily consented to the searches of their laptops. The Court further finds unavailing Defendants' arguments that the witnesses lacked the authority to do so. The witnesses had common authority over their laptops, as evidenced by their possession and password access.United States v. Matlock, 415 U.S. 164, 171-72 (1974). Defendants' heavy reliance on the fact they had confidentiality agreements with their employees is misplaced. A company cannot use such a confidentiality agreement to shield itself from government inquiry into evidence of potential illegal behavior, when the government has probable cause based on witness statements that such evidence exists, and the witnesses consent to the search. Defendants' position simply conflicts with public policy. McGrane v. The Reader's Digest Association, Inc., 822 F.Supp. 1044, 1046 (S.D.N.Y. 1993) ("Courts are increasingly reluctant to enforce secrecy arrangements where matters of substantial concern to the public — as distinct from trade secrets or other legitimately confidential information may be involved"), Chambers v. Capital Cities/ABC, 159 F.R.D. 441, 444 (S.D.N.Y. 1995) ("agreements obtained by employers requiring former employees to remain silent . . . concerning potentially illegal practices . . . can be harmful to the public's ability to rein in potentially harmful behavior"), Ventura v. Cincinnati Enquirer, 396 F.3d 784, 791 (S.D. Ohio, 2005) (J. Weber) (rejecting efforts to enforce an agreement to withhold evidence of crimes, because "reporting criminal activity to a prosecutor is not actionable"). For all of these reasons, the Court rejects Defendants' Motion to Suppress the evidence derived from the laptops turned over to the government by cooperating witnesses.
The Court has reviewed the government's Exhibit 11, which shows Teegarden signed a "Consent to Search" form voluntarily, in the presence of his Counsel. At the September 27, 2007 hearing, Agent Almaguer testified that Mike Wagner's attorney voluntarily turned over Wagner's computer on behalf of his client on March 16, 2005. The government therefore already had a copy of the information on such computer in its possession, but Wagner brought his computer in for review because, as Almaguer testified, "he wanted to show us documents." The Court further accepts the governments' representation in good faith as to Shelley Kinmon's consent to search her laptop.
F. The Teegarden Home Computer Evidence
Defendants next seek to suppress the government's possession of computer evidence it obtained from the Boone County, Kentucky Sheriff's Department pursuant to a March 1, 2005 warrant issued by District Judge David L. Bunning (doc. 171). Defendants essentially argue that the search that placed the evidence in the hands of the Boone County Sheriff's Department, a search based on a warrant in an unrelated criminal matter, was really a pretext for federal agents to seize the computers (Id.). Defendants argue the state officers were not authorized by the scope of the state warrant to have reviewed the computers so as to discover evidence relating to the Berkeley matter, and then so as to have alerted Almaguer as to its existence (Id.). In addition, Defendants reiterate the same arguments already addressed above, in attacking the affidavit Almaguer used to seek the warrant, an affidavit essentially identical to that used in support of the warrant issued for the March 16, 2005 search (Id.).
The Court finds the government's position on this issue well-taken that Defendants' arguments are speculative in nature, and that Judge Bunning's finding of probable cause is entitled to great deference. United States v. Goff, 6 F.3d 363, 366 (6th Cir. 1993). The evidence obtained by the federal warrant does not rely upon the state warrants used in the unrelated criminal matter. The Court is satisfied by Almaguer's sworn statement in the Kentucky warrant affidavit that he first learned of the Boone County seizure on February 4, 2005, nearly a month after the seizure took place. As such, there is no basis to conclude that he or other case agents directed the Boone County Sheriff's Office to obtain its search warrant or to seize evidence outside the scope of the state warrant. Moreover, as the unrelated criminal matter involved the use of a computer, the Court cannot find it unreasonable that state officers seized and reviewed computers from the Teegarden residence. The balance of Defendants' arguments the Court has already rejected in its discussions above.
G. Defendants' Allegations that the Government Improperly Exploited Parallel Civil Proceedings, and the FDA Unlawfully Inspected its Premises.
Defendants next move the Court to suppress for an Order suppressing all evidence obtained by the Federal Trade Commission ("FTC"), the Food and Drug Administration ("FDA"), and the Multi-state Attorneys General Group ("AG"), and/or for an Order dismissing the Indictment based on alleged misconduct in the civil proceedings (doc. 171). The crux of Defendants' theory is that the various civil investigations commenced at about the same time that the government commenced its criminal investigation, that the investigations were improperly intertwined, and that Defendants had no idea about the existence of the criminal investigation, such that the civil agencies were able to unfairly obtain information to the prejudice of Defendants (Id. citing United States v. Rand, 308 F.Supp. 1231 (N.D. Ohio 1970), United States v. Scrushy, 366 F. Supp.2d 1134 (N.D. Alabama, 2005),United States v. Stringer, 408 F.Supp. 2d 1083, 1090 (D. Ore. 2006)). Defendants argue they "unwittingly" handed over documents, emails and other discovery on which the government based its criminal investigation, and that they were tricked (Id.). Defendants critique on numerous technical grounds the propriety of the FDA's investigation, which it argues was a pretext for a criminal investigation (Id.).
The government submits in its reply that the civil investigations conducted by the FDA, FTC and the AG group were all entirely proper, conducted independently, and were not improperly intertwined or coordinated with the criminal investigation that led to the Indictment (doc. 192). The government argues that outside of parallel timing and unsupported propositions, Defendants have provided no evidence of any connection between the civil and criminal investigations besides Almaguer's statement that he relied on documents obtained from the FTC in his affidavit in support of the application for search warrant (Id.). This alone is inadequate, argues the government, because Almaguer obtained all FTC documents on July 19, 2004 through standard procedures authorized by FTC regulations (Id.,citing 16 C.F.R. § 4.11(c)). Unlike Scrushy, and Stringer, cases where criminal investigators directed conduct in civil investigations to obtain evidence, while concealing their involvement, the government argues the Defendants can point to nothing similar happening here (Id.). Nor, argues the government, is this case on point with Rand, where the civil case was found to be a pointless exercise that was actually a ruse to gather evidence of a crime (Id.). Here, the FTC's investigation actually resulted in a civil action filed in accordance with its statutory authority, and there is no evidence its investigation was directed by criminal investigators (Id.). The government further submits it had no input into the AG's investigation and never had access to materials obtained by the AG group (Id.). Similarly, the government argues the FDA's investigation of Berkeley complied with the law and was undertaken in response to consumer complaints (Id.). The government contends Defendants have proffered no evidence that the FDA's investigators were even aware of the separate criminal investigation, or were acting other than pursuant to their independent regulatory authority (Id.).
Defendants reply that the government conceded in its Response that it failed to advise Defendants during ongoing FTC proceedings that the government was actively pursuing their indictment (doc. 209). Defendants argue the Court is left to rely upon untested, unsworn assertions that Almaguer did not improperly intermingle his criminal investigation with the civil action being pursued by the FTC (Id.). Defendants argue the key problem is that Defendants must know about the existence of a criminal investigation, and they were never advised they were targets of a criminal investigation while cooperating with the FTC, AG and FDA (Id.).
Having reviewed this matter, the Court finds Defendants' position lacking in merit. The Court finds the evidence shows the FTC, AG, and FDA acted in conformity with their regulatory authority. The Court sees no evidence that their actions were controlled by criminal investigators, or even that any of the civil agencies knew of the criminal investigation. Defendants' technical critique of the FDA investigation in no way persuades the Court that such investigation failed to comport with regulations and the Fourth Amendment.
Moreover, Defendants' core theory is premised on the idea that they were led down the primrose path to cooperate with the various civil investigations to their prejudice, as if they had no idea that there could be a criminal investigation brewing. Such theory does not stand up to the evidence. The evidence shows rather that momentum was building on a number of independent fronts against Warshak and his companies, and Defendants could not have avoided knowing they could be held criminally accountable. The Court finds it particularly significant that as early as January 2004, Defendants knew they were the subject of an inquiry from multiple state Attorney Generals, that by April of that year included California, the District of Columbia, Illinois, Kansas, Montana, North Carolina, Ohio, Oregon, Vermont, Washington, and Wisconsin. For all of these reasons, the Court rejects Defendants' arguments attacking the propriety of the civil investigations.
H. Defendants' Allegation that the Government Invaded the Defense Camp
Defendants next argue the government invaded "the defense camp," through improper interrogation so as to get defense legal strategy, such that their Sixth Amendment right to counsel was violated and the Indictment should be dismissed (doc. 192). Defendants argue specifically that the laptops provided to the government by Wagner, Teegarden, and Cossman had privileged information on them, and that during proffer interviews with Kinmon, Teegarden, and Wagner — who were all past or present principles in Berkeley's management — the government repeatedly sought information protected by the joint defense privilege (Id.). Defendants submit that Teegarden informed agents of a conversation he had with Warshak sometime after March 16, when Warshak described how he would defend the case, and that Wagner similarly disclosed strategy and information from an attorney-client meeting at the Phillips law firm (Id.).
The government argues, relying on Weatherford v. Bursey, 429 U.S. 545, 552-558 (1977), that a Sixth Amendment violation only occurs where there is intentional intrusion into the attorney-client privilege to the detriment of a defendant (Id.). In this case, it replies, there was no interrogation of any witness about defense strategies, trial preparation, or other matters (Id.). In fact, all of the statements attributed to cooperating witnesses in Defendants' Motion stemmed from conversations directly with Defendant Warshak and involved no defense counsel (Id.).
At the Kastigar-like hearing the government already indicated that it did not intend to use any privileged information in its case. The Court already found agent testimony credible that during witness proffers, agents held the attorney-client privilege in due regard. Moreover, the government's position is well-taken that Defendants have shown no prejudice, nor linked any of the discussions to which they refer to discussions with defense counsel. Indeed, Defendants' citation to an "attorney-client" meeting at the Phillips law firm is not bourne out by the record. The evidence shows the meeting took place at the firm only because they needed a bigger room, and that the subject of discussion centered around accounting issues. The Court squarely rejects Defendants' theory that the government improperly invaded the defense camp.
I. Alleged Violation of Grand Jury Secrecy
Defendants argue the Almaguer improperly used information obtained from the criminal grand jury investigation in the two civil forfeiture proceedings filed before this Court relating to Warshak and Berkeley assets (doc. 171). The government responds correctly that Almaguer was authorized by 18 U.S.C. § 3322 to use grand jury information in connection with the federal civil forfeiture proceedings (doc. 192). Defendants' reliance on United States v. Sells Engineering, Inc., 463 U.S. 418, 424-443 (1983), and United States v. Forman, 71 F.3d 1214, 1218 (6th Cir. 1995), for the proposition that Almaguer needed prior judicial approval for the use of grand jury materials in the civil matters is misplaced, as these cases were superceded by the statute.
J. Defendants Argue the Aggregate Conduct of the Government Justifies Dismissal of the Indictment
It appears to the Court Defendants abandoned this argument as they did not address the government's Response in their Reply. In any event, the Court will briefly address Defendants' argument. Defendants summarize in this section their allegations made in the preceding sections, and mention the sexual entrapment theory the Court already rejected in its Order on August 21, 2001 (doc. 157). Defendants also add a complaint that Almaguer allegedly repeatedly violated professional responsibility "anti-contact rules" by communicating with parties represented by counsel without consent (Id.). Finally, Defendants allege the prosecution improperly made "threats of obstruction of justice" in requesting that grand jury recipients not disclose the existence of the subpoena for 90 days (Id.). Taken together in the aggregate, Defendants argue these allegations show government has acted so outrageously that the Court should dismiss the Indictment (Id.).
The government responds that there was no outrageous conduct by its agents, and that it has shown the investigation has been lawful and proper (doc. 192). The United States, citing Bank of Novia Scotia v. United States, 487 U.S. 250, 254, 261 (1988), argues dismissal is only warranted where there is longstanding prosecutorial misconduct resulting in prejudice to Defendants (Id.). Defendants, argue the government, have made no such showing (Id.).
The Court rejects Defendants' theory that taken together in the aggregate the government's conduct amounts to an outrageous violation of their due process rights, justifying dismissal of the Indictment. In addition to the issues already addressed, the Court finds well-taken the government's position concerning Defendants' additional allegations about Almaguer, the no-contact rule, and the prosecutions allegedly improper threats. The facts do not bear out such allegations. The prosecution conducted itself properly in this matter.
K. Count 111
Defendants argue Count 111, which charges Defendants Kellogg, Pugh, and Berkeley conspired to obstruct proceedings before the FDA is defective and should be dismissed (doc. 171). Defendants argue that under the obstruction statute, 18 U.S.C. § 1505, the government must plead the existence of a "pending" agency "proceeding" (Id.). In this case, argue Defendants, the government alleges Defendants conspired to obstruct an FDA investigation, which does not constitute a pending agency proceeding within the scope of Section 1505 (Id.).
The government responds that Defendants ignore the fact that Count 111 charges a conspiracy to obstruct the investigation pursuant to 18 U.S.C. § 371, and not the substantive offense of obstruction under 18 U.S.C. § 1505 (doc. 192). Quoting United States v. Atlantic States Cast Iron Pipe Co., No. 03-852, 2007 U.S. Dist. LEXIS 56562, at *194 (D.N.J. Aug. 2, 2007), the government argues, "There is no 'pending proceeding' requirement for a conspiracy to violate 18 U.S.C. § 1505, in contrast to that requirement as an element of the substantive offense under Section 1505" (Id.). The government contends that Count 111 satisfies the requisite allegations under United States v. Mullins, 22 F.3d 1365, 1368 (6th Cir. 1994) that there was an agreement to obstruct the inspection, that Defendants knowingly and voluntarily joined the agreement, and at least one overt act was committed in furtherance of the object of the agreement (Id.).
The Court agrees with the government's view that Count 111 adequately alleges a conspiracy to obstruct FDA proceedings. The Court need not reach the parties' respective arguments about whether an FDA inspection constitutes a proceeding under Section 1505, because the government does not bring a substantive charge pursuant to that section, but rather brings a conspiracy charge under 18 U.S.C. § 371. United States v. Atlantic States Cast Iron Pipe Co., No. 03-852, 2007 U.S. Dist. LEXIS 56562, at *194 (D.N.J. Aug. 2, 2007). Nor will the Court address again Defendants' renewed and meritless argument that the FDA investigation was a pretext. The Court finds Count 111 adequately alleges a conspiracy and finds no basis to dismiss it.
L. Counts 15, 23, and 27 Alleging Bank Fraud
Counts 15, 23, and 27 charge Steven and Harriet Warshak with falsely misleading credit card processing companies into believing that the entities for which Defendants were applying had never had a bank card relationship terminated, that the entities had never processed MasterCard or Visa before, that Harriet Warshak was the owner of various companies, and/or that the entities had higher number of transactions than in actuality, so as to reduce the chargeback ratio. Defendants next argue that the bank fraud counts should be dismissed for failing to show the materiality of any false statement, failing to show Defendants intended to cause financial harm to the banks or credit card processors, and for failing to show the banks transferred funds and/or were placed at risk in the short term (doc. 171).
The government responds, citing United States v.Davis, 397 F.3d 340, 344 (6th Cir. 2005) that the elements of bank fraud, in addition to showing a materiality of falsehood, are 1) that defendant knowingly executed or attempted to execute a scheme to defraud a financial institution, 2) that the defendant did so with intent to defraud, and that 3) the institution was insured by the Federal Deposit Insurance Corporation (doc. 192). The government argues that the facts alleged in the indictment warrant the inference of materiality (doc. 192, citing United States v. McAuliffe, 490 F.3d 526, 532 (6th Cir. 2007)). In the government's view, the alleged misrepresentations all relate to the criteria banks use to select their merchant account holders, and so materiality can be inferred (Id.). The government further contends the facts warrant an inference of intent to defraud, and moreover each of the counts provides that one or more Defendants "devised and intended to devise" a scheme and artifice to defraud (Id.). These allegations are sufficient, argues the government, such that the Indictment meets the requirements of materiality and intent to defraud (Id.).
The Court finds the government's position correct that the bank fraud counts in its Indictment sufficiently meet the materiality and intent to defraud requirements through reasonable factual inferences. United States v. McAuliffe, 490 F.3d 526, 532 (6th Cir. 2007). Having reviewed the Indictment, the Court finds the counts very adequately allege the elements of bank fraud. United States v.Davis, 397 F.3d 340, 344 (6th Cir. 2005)
M. Count 108 and Duplicity
Count 108 of the Indictment charges Steven Warshak with money laundering, in violation of 18 U.S.C. § 1956 and § 2. The government alleges Warshak took money generated from the alleged fraud scheme, and on 49 different occasions over a two-year period, directed the issuing of checks for $5,000 so as to conceal and disguise the source of the funds. Defendants argue this count is duplicitous, in that the government has improperly charged forty-nine separate and distinct crimes in one single count (doc. 171,citing United States v. Davis, 306 F.3d 398, 415 (6th Cir. 2002). Accordingly, Defendants argue the Court should dismiss the Count and the government should supercede with additional charges should it so choose (doc. 209).
The government responds under United States v. Savoires, 430 F.3d 376, 380 (6th Cir. 2005) that a duplicitous charge "is not prejudicial per se, because proper jury instructions can mitigate the risk of jury confusion and alleviate the doubt that would otherwise exist as to whether all members of the jury had found the defendant guilty of the same offense" (doc. 192). The government proposes a specific instruction to the jury predicating a finding of guilt on a unanimous decision as to each of the forty-nine transactions would adequately protect the rights of the Defendant. In the alternative, the government recommends the Court reformulate Count 108 into forty-nine distinct counts. (Id. citing United States v. Duncan, 850 F.2d 1104, 1108 n. 4 (6th Cir. 1988)).
The Court agrees with the government that in this instance a jury instruction, as proposed, will adequately cure any possible confusion and will protect the rights of Defendant Warshak.Savoires, 430 F.3d 376, 380.
N. Counts 30, 31, and Multiplicity
Defendants next argue that counts 30 and 31 charge the same crime twice and therefore one count should be dismissed as multiplicitous (doc. 171). Count 30 charges Defendants with violations of 18 U.S.C. § 1956(h), alleging that Defendants conspired to commit money laundering in violation of 18 U.S.C. § 1956(a)(1)(A) and (B). Count 31 also charges Defendants with violations of 18 U.S.C. § 1956(h), but for conspiracy in violation of engaging in monetary transactions in property derived from specified unlawful activity, in violation of 18 U.S.C. § 1957. Section 1956(h) allows for conspiracy charges to be brought with different statutory mechanisms in Section 1956 or 1957. The money laundering charge requires a showing of intent, Section 1956(a)(1)(A)(I), whereas the Section 1957 offense has no intent requirement but contains a $10,000 jurisdictional element. The Court concludes that Congress has created two distinct, although similar crimes that can be charged, as in this instance, for the same underlying behavior. Should a jury find Defendant lacked the requisite intent but that he met the rest of the requirements for transactions derived from unlawful activity, he could be found guilty of that charge while exonerated of the other. Accordingly, the Court concludes that counts 30 and 31 are not multiplicitous and rejects Defendants' arguments to the contrary.
O. Ex Parte Submissions
Defendants argue their constitutional rights and common law right of access to documents filed in legal proceedings require the disclosure of all documents the government has submitted ex parte to this Court in three of the related pending civil cases, as well as a four-page document the prosecution sent to the taint review AUSA, Mark D'Alessandro, but did not provide to the defense (doc. 171). Defendants argue that "absent the most exceptional of circumstances no party to a lawsuit, criminal or civil, should be able to influence the decision-maker through secret ex parte filings" (Id.). Defendants continue that because the criminal investigation is over, there remains no continuing need to maintain any ex parte files under seal (Id.).
The Court stayed all of the related civil cases on December 27, 2006. Two of the cases are civil forfeiture cases in which the government has frozen Warshak's assets, United States of America v. Contents of Nationwide Life Insurance Annuity Account No. 0961 in the Name of Steve E. Warshak, et al., No. 1:05-CV-196, andUnited States of America v. Contents of Smith Barney Citigroup Account No. 3419 et al., No. 1:06-CV-00185. In the third case, Defendants are seeking injunctive relief, and a return of all attorney-client privileged documents seized on March 16, 2005.Berkeley Premium Nutraceuticals Inc., et al. v. U.S.A., No. 1:06-CV-00234.
The government responds that Almaguer's ex parte affidavit in Case No. 1:06-CV-00234 is not currently discoverable under Fed.R.Crim.P. 16(a)(2), unless and until Almaguer would testify on direct examination (doc. 192). The government submits it does not intend to call Almaguer as a witness, and therefore, the affidavit is not discoverable (Id.).
As for Case No. 1:05-CV-00196, the government responds the documents at issue are stay submissions, tax evidence, a Declaration by Almaguer in Support of the forfeiture complaint, and attachments to Almaguer's Affidavits in Support of the Seizure Warrants (Id.). The government contends the stay submissions and tax evidence are authorized to be filed ex parte under 18 U.S.C. §§ 981(g)(5) and 983(f)(4) (Id.). Both sections, argues the government, contemplate such submissions when the evidence therein could adversely affect an ongoing criminal investigation or a pending criminal trial (Id.). As for the Declaration, the government argues it is duplicative in nature to affidavits already produced (Id.). Finally, the government argues the attachments constitute work product, and therefore are protected from disclosure (Id.).
The issues in Case No. 1:06-CV-00185 mirror those immediately above (Id.). The government argues an ex parte stay submission should not be disclosed, and that attachments to Almaguer's affidavit, which are identical to those disputed above, are likewise work product (Id.). In regards to the four-page document sent for taint review, the government argues the contents do not present any adversarial slant, and it should remain sealed.
Defendants reply that the failure of the prosecution to produce the disputed documents would adversely affect the fairness of the impending trial (doc. 209). Defendants argue that the government has unfairly made use of privileged information to advance its position, and should not be permitted to use privilege as both a sword and a shield (Id. citing United States v. Lott, 424 F.3d 446, 454 (6th Cir. 2005).
The Court finds Defendants' arguments lacking in merit. The government has complied with its Fed.R.Crim.P. 16 discovery obligations in this criminal matter, and, pursuant to the Court's order has recently produced all of the evidence it intends to use at trial. The Defendants have the evidence they are entitled to under the rules, and their rights are not violated by a denial of the information they seek from stayed civil matters.
The Court agrees with the government that there is a valid statutory basis to retain the stay submissions and tax evidence under seal. 18 U.S.C. §§ 981(g)(5) and 983(f)(4). The Court fails to understand why the government opposes the production of a document on the basis that it is duplicative, as it is difficult to see how the government would therefore be prejudiced by turning it over. However, the Court accepts the government's representation in good faith that Defendants already have the information contained therein, and do not need it. Finally, the Court views Defendants' attempt to obtain materials the government claim are protected work product, as an attempt to end-run around Rule 16. Defendants should not be permitted to obtain bonus evidentiary material by virtue of the fact that they have civil cases pending against them.
Finally, the Court agrees that generally work-product should not be used as an affirmative submission in a case, and then shielded from disclosure by the privilege. However, the information in question is not being used as an affirmative submission in this case, but rather, is a part of distinct civil proceedings that are stayed pending the outcome of this matter. The Court finds therefore, no valid basis to require the government to disclose the contested attachments to Defendants.
P. Liminal Motion
Defendants bring a motion in limine, challenging the admissibility of an audiotape and transcript in the possession of the government. The Court will reach all liminal motions at trial, should the evidence be proffered and challenged.
Q. The Kellogg Submissions
At the December 4, 2007 final pretrial conference, counsel for Defendant Kellogg submitted two sets of documents for in camera review, consistent with the Court's November 13, 2007 Order denying Kellogg's Motion for Severance and Separate Trial (doc. 226). Kellogg argues the nature of such evidence shows he is barred from using it in his defense, as it falls under the protection of attorney-client privilege. In its previous Order, the Court found all such evidence would probably fall within the crime-fraud exception to the attorney client privilege, such that Kellogg would be free to use it in his defense (doc. 226). Having reviewed the evidence in camera, the Court stands by its conclusion expressed at the December 4, 2007 conference that all questions regarding the applicability of the crime-fraud exception will be handled as they arise at trial.
III. Conclusion
For the reasons indicated herein, the Court finds no basis for the suppression of evidence in this case, and finds no basis for the dismissal of any portion of the Indictment. The Court concludes the government's investigation in this matter was untainted by any actionable statutory, due process or other constitutional violation. Defendants are therefore not entitled to the relief they seek. Accordingly, the Court DENIES Defendants' Pretrial Omnibus Motion (doc. 171) in all respects.
SO ORDERED.