Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-96-05317/USCOURTS-caDC-96-05317-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 12, 1997 Decided February 17, 1998 

No. 96-5317

CLARK M. CLIFFORD AND 

ROBERT A. ALTMAN,

APPELLANTS

v.

UNITED STATES OF AMERICA, ET AL.,

APPELLEES

Appeal from the United States District Court 

for the District of Columbia 

(No. 96ms00266)

Timothy J. Preso argued the cause for appellants, with 

whom William H. Jeffress, Jr., Martin D. Minsker and 

Douglas F. Curtis were on the briefs.

Marc J. Gottridge argued the cause for appellees, with 

whom Sol Neil Corbin, Stephen J. Brogan, Eric L. Lewis and 

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Michael Nussbaum were on the brief for appellees First 

American Bankshares, Inc., et al. 

Mary Lou Leary, U.S. Attorney at the time the brief was 

filed, Michele L. Crawford, Trial Attorney, and Stefan D. 

Cassella, Assistant Chief, U.S. Department of Justice, were 

on the brief for appellee United States of America.

Before: WILLIAMS and ROGERS, Circuit Judges and 

BUCKLEY, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge ROGERS.

ROGERS, Circuit Judge: Appellants, Clark M. Clifford and 

Robert A. Altman, appeal an order of the district court 

denying access to certain sealed documents and transcripts of 

in camera conferences between the judge and a courtappointed trustee in the course of an ongoing criminal forfeiture proceeding. Appellants are not party to that proceeding, but are involved in several civil actions pending before 

the same judge as adversaries to the parties appearing in the 

criminal matter. Appellants contend that the communications between the trustee and the judge relate to their 

concurrent civil cases and that due process requires that they 

be notified and provided with copies of any such communications. Because appellants have failed to provide sufficient 

evidence to overturn the district court's finding that the 

submitted information did not involve matters directly related 

to the civil litigation, and because their other grounds for 

access to the sealed documents, rooted in the equitable principles of trust law, are unpersuasive, we affirm.

I.

This appeal involves a subsidiary dispute arising out of the 

lengthy and ongoing legal proceedings involving the Bank of 

Credit and Commerce International ("BCCI") and the related 

activities of its officers, directors, and shareholders. Suffice 

it to say for purposes of the instant appeal that BCCI pled 

guilty to several state and federal charges, including conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act ("RICO") by illegally acquiring a controlling interUSCA Case #96-5317 Document #331135 Filed: 02/17/1998 Page 2 of 16
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est in First American Bankshares, Inc. ("FAB") and First 

American Corporation ("FAC") (collectively "First American"). See 18 U.S.C. § 1962(c), (d) (1988). As a result, 

pursuant to an agreement between BCCI and the United 

States, the district court ordered the forfeiture of all of 

BCCI's property in the United States, including whatever 

interest it may have had in First American. As relevant 

here, the court ordered the forfeiture of "the net proceeds 

from the future sale or other disposition or transfer of any 

stock, security or other interest in First American Bankshares, Inc., but not the stock, security or other interest 

itself."

Executing this forfeiture agreement proved to be complicated due to the nature of the conspiracy. BCCI did not 

directly own any interest in First American. Rather, through 

intermediaries, it acquired a controlling interest in a Netherlands Antilles corporation, Credit and Commerce American 

Holdings, Inc. ("CCAH"). The extent of this interest was 

uncertain at the time of the forfeiture order but has been 

subsequently calculated to amount to 61.156%. Other shareholders in CCAH included appellants Clifford and Altman, 

whose shares have been estimated at 0.828% and 0.414% 

respectively. In turn, CCAH owned a subsidiary corporation, 

Credit and Commerce American Investment ("CCAI"), which 

owned FAC, which owned FAB.

Faced with this tangle of interlocking subsidiary corporations, the United States decided that the best course for 

recovering its forfeited interest was to dissolve First American and liquidate its assets. To facilitate the process, the 

government proposed the appointment of a trustee under 18 

U.S.C. § 1963(e) and developed a plan whereby CCAH would 

transfer all of its interest in First American to the trustee, 

who would "have all rights, titles, powers, and privileges of a 

shareholder of FAC, including ... the right to exercise 

exclusively any and all voting rights and any other rights or 

benefits attached to ... the FAC shares." According to the 

plan, once the trustee completed the sale of First American, 

the district court would order the equitable distribution of the 

net proceeds (after payment of expenses) to the United States 

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and any outstanding shareholders of CCAH.1 Because BCCI 

was not the sole shareholder of CCAH, the government 

needed to win the approval of others to muster the 75% share 

vote necessary for the plan to take effect, and on May 12, 

1992, CCAH's shareholders, including Clifford and Altman, 

approved the proposed transaction. Subsequently, the district court appointed a trustee and required him to prepare 

quarterly progress reports.

The trustee successfully completed the sale of First American's assets, and in October 1994 filed a motion seeking a 

"Procedural Order" on the procedures he should follow in 

dissolving the corporation, completing its liquidation, and 

distributing the proceeds. Following a public hearing on 

December 19, 1994, the court, by order dated two days later, 

directed the trustee to obtain lists of all proceedings and 

claims against First American, the amounts estimated as 

appropriate to reserve for payment for each, and estimated 

associated expenses, and to file these documents under seal.

Meanwhile, several civil lawsuits involving appellants Clifford and Altman began to unfold. Appellants had served in 

various capacities for BCCI prior to its legal difficulties. In 

addition to owning shares in CCAH, they had also served as 

directors and officers of CCAH, CCAI, and First American 

and as legal counsel for BCCI and First American. On June 

24, 1993, the trustee, on behalf of First American, filed suit 

against several defendants, including Clifford and Altman, for 

their participation in the acquisition of First American by 

BCCI, alleging violations of RICO, common law fraud, breach 

of fiduciary duty, and conspiracy. See First Am. Corp. v. AlNahyan, No. 93-1309 (D.D.C. filed June 24, 1993). Similarly, 

on July 1, 1994, BCCI's fiduciaries filed suit alleging that 

Clifford and Altman (as well as their former law partners) 

had breached their fiduciary duties and improperly represented both BCCI and First American during their financial 

dealings despite conflicts of interest. See BCCI Holdings, 

S.A. v. Clifford, No. 94-1461 (D.D.C. filed July 1, 1994). Both 

__________

1 Any shareholder or other party who wished to contest the 

government's share could intervene in the distribution proceedings 

under 18 U.S.C. § 1963(l).

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lawsuits are currently pending before the same judge who is 

presiding over the criminal forfeiture proceedings.

Appellants have also filed several civil lawsuits of their own. 

In March 1995, appellants filed a claim in the federal court in 

the Eastern District of Virginia for indemnification from First 

American. See Clifford v. First Am. Corp., No. 95-377-A 

(E.D. Va. filed Mar. 24, 1995). They sought reimbursement, 

as officers and directors of First American, for legal fees 

incurred in the successful defense of criminal charges that 

had been brought against them in New York.2 This lawsuit 

was ultimately transferred to the District Court for the 

District of Columbia and assigned to the same judge. See 

Clifford v. First Am. Corp., No. 95-877 (D.D.C. filed May 10, 

1995). In September 1995, appellants filed another indemnification suit in federal court here against First American, 

seeking reimbursement for the defense of the civil claims 

brought against them by BCCI and First American and an 

administrative action being pursued by the Federal Reserve 

Board. See Clifford v. First Am. Corp., No. 95-1689 (D.D.C. 

filed Sept. 5, 1995). That lawsuit has been stayed pending 

the outcome of the other civil lawsuits currently before the 

district court.

In the instant case, appellants filed a motion on November 

13, 1995, to intervene in the criminal proceeding against 

BCCI for the "limited purpose of obtaining disclosure of 

information that has been communicated to [the district 

court] by parties ... [or] the First American Trustee ... and 

that may be communicated in the future." Asserting that 

several communications between the trustee and the judge in 

the course of the forfeiture proceedings related to their 

concurrent civil litigation, appellants requested notes of a 

November 16, 1992, in camera discussion among the judge, 

the trustee, and counsel for both BCCI's fiduciaries and the 

United States.3 This off-the-record conference was prompted 

__________

2 For a summary of the disposition of the criminal cases against 

appellants, see People v. Abedi, 607 N.Y.S.2d 862 (N.Y. Sup. Ct. 

1994).

3 On appeal, appellants also mention a second in camera conversation between the trustee and the judge that occurred after the 

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by remarks made by counsel for the BCCI fiduciaries that he 

wished to discuss "a future piece of litigation." Appellants 

maintain that this remark, as well as other statements made 

by the prosecutor, were meant to refer to the Al-Nahyan

action and the BCCI suit that was later filed against them.

Appellants also object to their lack of access to certain 

material contained in a sealed report filed by the trustee in 

July 1995.4 Pursuant to the Procedural Order, the trustee 

submitted a "Report on the First List of Claims and Contingencies of First American" containing a list of pending legal 

proceedings and claims asserted against the corporation, including the various actions involving appellants. This document, placed in the public record and obtained by appellants, 

referred to another report filed under seal with the court at 

the same time that included First American's "Reserve Lists" 

and "Expense and Indemnity List" as required by the Procedural Order. Upon reviewing the public report, appellants 

requested a copy of the sealed document from the trustee. 

When their request was refused, appellants moved to intervene in the criminal proceeding to gain access to the sealed 

report and any other sealed documents submitted to the court 

that referred to their civil lawsuits. They also requested that 

they be notified and served with copies of any future filings 

that relate to pending civil lawsuits in which they are parties. 

In opposing appellants' motion, the trustee revealed that the 

sealed report contained "brief explanatory narrative[s] describing the nature and status of pending claims and proceed-

__________

hearing on the proposed Procedural Order on December 19, 1994. 

This communication was not identified in appellants' motion to 

intervene in the district court. There is no indication that this 

conference concerned appellants; the judge merely invited the 

trustee into her chambers to discuss "other[ ] matters."

4 Appellants further object to the treatment of other communications that were not filed under seal: the trustee's "Second 

Interim Report on Trust Activities," filed May 15, 1995, and his 

"First List of Claims and Contingencies," filed July 19, 1995. 

Because these documents were available in the public record, 

appellants' only contention appears to be that they were not served 

with copies of the reports.

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ings" as well as the required lists of reserves maintained by 

First American for each outstanding claim. Appellants rely 

on this revelation to support their contention that the communications between the trustee and the judge addressed the 

merits of their claims.

Denying the motion to intervene in the criminal proceeding 

without comment,5the court, sua sponte, treated the motion 

as if it had been "properly filed as a miscellaneous case under 

Local Rule 307.1." See D.D.C. R. 307.1. The court ruled 

that appellants had waived their objections to the Procedural 

Order and, therefore, could not seek disclosure of the sealed 

reports. The court further found that "disclosure is ... 

inappropriate because the material filed under seal, or to be 

filed under seal, involves matters not directly related to [the] 

civil litigation." The court also denied appellants' request for 

transcripts of the in camera discussions because they "did 

not involve the merits of any litigation filed by, or against, 

Clifford and Altman."

We review the district court's refusal to disclose the sealed 

documents and any in camera discussions for abuse of discretion. Cf. EEOC v. National Children's Ctr., Inc., 98 F.3d 

1406, 1409 (D.C. Cir. 1996); In re National Broad. Co., 653 

F.2d 609, 613 (D.C. Cir. 1981)

II.

Complex litigation may often require the district court to 

consider facially conflicting claims against some or all of the 

parties involved in the initial underlying litigation. As a 

matter of court management and efficiency, the assignment of 

related matters to a single judge is preferred. See D.D.C. R. 

405. Indeed, the courts have developed rules and presumptions that enable the most efficient use of limited judicial 

__________

5 Appellants do not appeal the formal disposition of their motion to intervene in the criminal proceedings. Therefore, we need 

not address the proper procedural mechanism for non-parties to 

seek disclosure of documents sealed in a criminal trial. See United 

States v. Hubbard, 650 F.2d 293, 308-13 (D.C. Cir. 1980); In re 

Washington Post Co., 576 F. Supp. 76, 77 n.1 (D.D.C. 1983).

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resources while at the same time protecting the various 

parties' rights to have their claims and arguments heard and 

decided by an impartial decision-maker. Trial judges frequently receive extraneous information about parties appearing before them but are presumed to disregard it. See 

Harris v. Rivera, 454 U.S. 339, 347 (1981). In the course of a 

trial, as well as at pre-trial suppression hearings or during 

discovery, a judge may inspect documents or evidence that go 

to the heart of a party's case but are ultimately determined to 

be inadmissible. See United States v. Cowden, 545 F.2d 257, 

265-66 (1st Cir. 1976) (recognizing that judges "are necessarily exposed to [matters outside the record] in the course of 

ruling on the admission of evidence"). Similarly, a judge may 

have personal experience with particular parties who have 

appeared before her in previous cases, or she may have 

learned about underlying events by presiding over related 

trials. See id. Yet such prior knowledge does not, by itself, 

generally raise questions about the fairness of a judge.6See 

Liteky v. United States, 510 U.S. 540, 550-51, 555 (1994); 

United States v. Roach, 108 F.3d 1477, 1484 (D.C. Cir. 1997); 

Paradis v. Arave, 20 F.3d 950, 956-57 (9th Cir. 1994). 

Judges are presumed to be able to compartmentalize the 

information they receive and only rely on evidence relevant 

for a particular decision. See Harris, 454 U.S. at 346; 

United States v. Menk, 406 F.2d 124, 126-27 (7th Cir. 1968);

In re M.D.J., 346 A.2d 733, 736 (D.C. 1975).

Still, the instant case appears somewhat unusual in that a 

single district court judge is presiding over a civil lawsuit 

__________

6 Of course, if a judge's personal knowledge rises to the level 

where it creates the appearance of bias or prejudice, then the 

judge's recusal is required under 28 U.S.C. § 455. See Liteky v. 

United States, 510 U.S. 540, 548, 554-56 (1994); see also MODEL 

CODE OF JUDICIAL CONDUCT Canon 3E(1) (1990). But, in the instant 

case, appellants have not sought the disqualification of the district 

court judge, nor do they claim that her communications with the 

trustee have actually affected her impartiality. Hence, we have no 

occasion to consider the circumstances under which a judge performing both administrative and judicial functions over related 

cases should transfer one or both of the cases to another judge.

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(and other related civil lawsuits) while at the same time 

superintending the administration of a criminal forfeiture 

proceeding arising out of the same operative facts and involving some of the same parties. From their perspective as 

litigants in the civil lawsuits, appellants view the sealed 

reports filed by the trustee and his other discussions with the 

judge in the criminal proceeding as ex parte communications. 

They contend that these communications create an unfair 

advantage for the trustee in the civil litigation, or at the very 

least the appearance of unfairness, and violate the "fundamental concepts of fairness and equity embodied in the due 

process clause of the Fifth Amendment." Without seeking 

recusal of the judge, they maintain that due process requires 

that they receive notice of, and access to, any submissions by 

their adversaries so that they may have an "opportunity to 

know the claims of the opposing party and to meet them." 

Morgan v. United States, 304 U.S. 1, 18 (1938).7

Appellants' contentions overstate the strength of their due 

process claim. Even within the context of a single adversary 

proceeding, communications between a judge and one party 

are not per se deprivations of the due process rights of the 

opposing party, see In re Paradyne Corp., 803 F.2d 604, 612 

(11th Cir. 1986), and consequently, not all ex parte communications must be disclosed, particularly when there is a countervailing need for confidentiality. Due process concerns 

about the effect of such communications on the fairness of a 

trial as a whole are further mitigated where, as here, the trial 

is before a jury and the judge is not the ultimate finder of 

fact.8See United States v. Sepulveda, 512 F. Supp. 592, 594 

__________

7 When concerns arise over the effects of ex parte communications on the fairness of a trial, prejudiced parties ordinarily seek 

either a remand for a new hearing, see, e.g., Strang v. United States 

Arms Control & Disarmament Agency, 920 F.2d 30, 32 (D.C. Cir. 

1990) (per curiam), or reassignment of the case to a different judge, 

see, e.g., Edgar v. K.L., 93 F.3d 256, 262 (7th Cir. 1996); United 

States v. Microsoft Corp., 56 F.3d 1448, 1465 (D.C. Cir. 1995). 

Appellants, however, merely request disclosure as a remedy for the 

alleged denial of due process.

8

Indeed, the fact that three of the civil lawsuits have recently 

been assigned to a mediator, with the fourth likely soon to follow, 

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(D.D.C. 1981); cf. United States v. Robin, 553 F.2d 8, 10 (2d 

Cir. 1977) (per curiam).

Ex parte submissions are permissible to determine whether 

documents sought by a party enjoy a privilege against discovery, see In re Eisenberg, 654 F.2d 1107, 1112 (5th Cir. Unit B 

Sept. 1981); cf. Kerr v. United States Dist. Court, 426 U.S. 

394, 405 (1976), "to prevent frustration of a statutory purpose 

to limit access to Government papers," In re Taylor, 567 F.2d 

1183, 1188 (2d Cir. 1977), or "to resolve fears of intimidation 

of a witness," In re Paradyne Corp., 803 F.2d at 612. Due 

process, however, requires that a party be aware of and 

allowed to refute "the evidence against the merits of his 

case." In re Eisenberg, 654 F.2d at 1112 (emphasis added). 

Thus, in Rushen v. Spain, 464 U.S. 114 (1983) (per curiam), 

the Supreme Court "emphatically disgree[d]" with the Ninth 

Circuit's conclusion that an unrecorded ex parte communication between the judge and a juror in a criminal trial can 

never be harmless error. Id. at 117. Instead, the Court took 

the position that, while an ex parte communication relating to 

"some aspect of the trial ... generally should [be] disclose[d] 

... to counsel for all parties," id. at 119, the particular ex 

parte communication in question was "innocuous" because the 

judge and juror "did not discuss any fact in controversy or 

any law applicable to the case," id. at 121. The Court saw no 

reason to dispute the trial judge's affirmation at a post trial 

hearing that the ex parte communications "lacked any significance" and that no prejudice had resulted. Id. at 116.

Although Rushen was somewhat different from the instant 

case, in that it involved the charge that the judge's contact 

with a juror may have prejudiced the juror, the Court's 

approach to ex parte communications is instructive. Thus, 

when a party conveys ex parte information to a judge that 

relates to a pending case, courts presume that the trial judge, 

who is in the best position to evaluate the information, can 

adequately determine whether such communications go to the 

merits of the case and promptly stifle them or require 

__________

further reduces the relevance of appellants' concerns about the 

effect of these communications on the fairness of their trials.

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disclosure when necessary. See id. at 120. Without such a 

presumption, the process for handling litigation would become 

inordinately complex, occasioning additional delays and encumbering burdened trial judges with piecemeal responsibilities incompatible with the necessities of efficient trial management. See generally Civil Justice Reform Act of 1990, 28 

U.S.C. §§ 471-473 (Supp. IV 1992).

Here, the judge received information from the trustee that 

she had already deemed sufficiently sensitive and confidential 

so as to warrant precluding public disclosure. The judge 

found that the contents of these communications did not 

concern the merits of appellants' pending civil actions. It is 

appellants' burden to offer some evidence that would cast 

serious doubt on this finding, see United States v. Taylor, 997 

F.2d 1551, 1553 (D.C. Cir. 1993); cf. United States v. Pollard,

959 F.2d 1011, 1031 (D.C. Cir. 1992) (respecting trial judge's 

personal knowledge of the existence of ex parte submissions), 

and yet, upon examination, their contentions amount to little 

more than surmise and speculation. Accordingly, we defer to 

the trial court's factual determination.

The sealed trustee reports sought by appellants primarily 

contain lists of the amounts placed on reserve by First 

American to cover their expected liabilities and expenses in 

the various civil lawsuits still pending. This information has 

no apparent bearing on the merits of those lawsuits, for as 

the trustee explained to the district court, the amounts placed 

on reserve equal the full amount of pending claims and 

"reflect nothing about [First American's] judgment on the 

merits of various actions." These amounts, therefore, were 

already known by appellants, as they readily admit, as well by 

the court.

Nevertheless, appellants contend that "it is not the reserve 

figures themselves, but the narratives supplied by First 

American to accompany the reserves, that Messrs. Clifford 

and Altman seek." 9 But this position is no more persuasive. 

__________

9 Appellants' original motion to intervene requested disclosure 

of the sealed reports before they knew of the existence of the 

narratives.

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There is nothing to suggest that these brief "narratives" do 

anything more than explain the nature and status of pending 

claims and proceedings by or against First American, including the civil lawsuits to which appellants are parties. The 

judge presumably already has knowledge of the progress of 

these lawsuits, since she is presiding over them. Indeed, if 

the Second Interim Report filed by the trustee on May 15, 

1995, is any indication of the content of these "narratives," 

appellants' speculations are unfounded. Appellants rely on 

this publicly docketed report as evidence of improper communications between the trustee and the judge because it contains a discussion of the Al-Nahyan litigation in which appellants are defendants. This report, however, merely discusses 

the facts surrounding several settlements negotiated by First 

American with defendants other than appellants. In passing, 

the report only mentions without elaboration that the claims 

against appellants are still outstanding and that motions to 

dismiss the claims were pending before the court. Nothing in 

the report even approaches a discussion of the law or facts 

relevant to appellants' lawsuits, and there is nothing to suggest that the "narratives" in the sealed reports are more 

substantive.10

__________

10 Appellants' position with respect to the sealed reports is 

further weakened by their failure to take advantage of notice of the 

trustee's motion to enter the Procedural Order. Prior to the 

hearing on the order, appellants' counsel had received courtesy 

copies of the trustee's motion and the proposed order. Appellants 

were thus aware that, as paragraph 6 of the order detailed, certain 

reports would be sealed and that those reports would contain 

information relating to claims asserted by or against First American, including "Reserve Lists," an "Expense and Indemnity List," 

and comments by the trustee. Yet appellants acknowledge that 

they failed to make any appearance at the hearing, which was 

scheduled on the public docket, or file a written opposition. Hence 

appellants' contention that they could not have waived their alleged 

right to challenge the sealing of the reports because they were not 

directly notified that the hearing had been scheduled is unpersuasive.

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Appellants' assertions regarding the in camera conversations among the judge, the prosecutor, BCCI fiduciaries' 

counsel, and the trustee are even more speculative. On 

November 16, 1992, counsel for the court-appointed BCCI 

fiduciaries rather cryptically requested to speak off the record about "a future piece of litigation." At the same hearing, 

the prosecutor later remarked that the trustee also "wishes to 

raise a matter best made on the record and under seal." 11

The judge decided to "talk in chambers, not even on the 

record" about both issues. From these brief statements, 

appellants somehow draw the inference that the matters 

discussed involved themselves. Yet the BCCI fiduciaries did 

not file suit against appellants until July 1, 1994over one 

and a half years after this conferenceand the trustee did 

not commence the Al-Nahyan lawsuit until June 24, 1993. 

__________

Furthermore, by the time of the hearing, the Al-Nahyan and 

BCCI actions had already been filed against appellants, and appellants apparently had already decided to pursue indemnification for 

the costs of their criminal defenses. See Mem. in Reply to Opp'n to 

Mot. Relating to Indemnification at 1-2, United States v. BCCI 

Holdings, S.A., No. 91-0655 (D.D.C. filed Nov. 15, 1991). Therefore, by that date if not before, appellants should have been alerted 

to the sensitive nature of the information to be placed under seal. 

Indeed a passage in a memorandum in support of appellants' motion 

for indemnification filed in the criminal proceeding indicates that 

appellants were fully aware of the possible effects of the proposed 

Procedural Order even before they received copies of it. See Mem. 

in Reply to Opp'n to Mot. Relating to Indemnification, supra, at 

12-13. They had requested a hearing on the "procedural scheme" 

being considered by the judge because it would "obviously have a 

significant impact" on their "interests." Id. Thus, under these 

circumstances, the judge could properly find that appellants had 

made a knowing and intelligent waiver of any right they may have 

had to obtain access to the sealed reports. See Johnson v. Zerbst,

304 U.S. 458, 464 (1938).

11 On appeal, First American maintains that the trustee's information concerned his decision to replace the Chairman and Board of 

Directors of First American later that day and thus did not involve 

appellants. While plausible, this explanation is without record 

support.

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Consequently, there is scant evidence to suggest that the 

alleged ex parte communications even related to appellants' 

currently pending civil lawsuits. There is no evidence to 

suggest, moreover, that any participants in these communications failed to exercise care in speaking of pending matters; 

to the contrary, the record shows that the trustee made this 

concern clear, and the experienced trial judge is entitled to 

this court's deference in that regard. Cf. D.D.C. R. 307(a) 

(recognizing the propriety of "conferences in chambers" and 

"other matters normally handled in camera").

Finally, appellants contend that, regardless of their access 

to the sealed documents, at a minimum they should have been 

notified (and should be notified in the future) of any documents submitted to the judge that relate to their pending civil 

lawsuits. Specifically, they take issue with the absence of 

personalized notice after the filing of the Second Interim 

Report by the trustee. Although this report was not placed 

under seal, they consider it to be an ex parte communication. 

Due process, they contend, requires them to be given notice 

of such submissions. Appellants are mistaken. Since these 

submissions are open for public inspection, they do not create 

the appearance of unfairness or bias that motivates concerns 

over ex parte communications. Appellants may obtain copies 

of these documents, as they already have done, and if they 

conclude that the submissions are prejudicial to them in 

concurrent lawsuits, appellants, represented by able counsel, 

doubtless are aware of appropriate action that can be taken. 

Admittedly, the burden of vigilance is on appellants, but due 

process does not require that they be served with copies of 

these documents or otherwise personally notified by the 

judge. If it did, any other non-party whose interests could be 

affected by a case would have the same right to personal 

notice. The mere fact that appellants are engaged in concurrent civil litigation with the trustee does not differentiate 

them in this regard from other interested parties. This claim 

serves appellants no better than the others.

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III.

Appellants alternatively contend that they are entitled to 

inspect the sealed financial reports submitted by the trustee 

because they are beneficiaries of the trust he administers. 

According to the equitable principles of trust law, a "trustee 

is under a duty to the beneficiary to give him upon his 

request ... complete and accurate information as to the 

nature and amount of the trust property." RESTATEMENT 

(SECOND) OF TRUSTS § 173 (1957). This requirement is designed to ensure that the beneficiary receives any information 

necessary to protect his rights under the trust. See id. § 173 

cmt. c. Appellants maintain that, as shareholders in CCAH, 

they (along with the United States government) are among 

the ultimate beneficiaries of the trustee's sale of First American. Appellants and the other CCAH shareholders agreed to 

transfer all of the interest in First American held by CCAH's 

subsidiary, CCAI, to the trustee. The proceeds of the liquidation of First American not attributable to BCCI's interest 

in CCAH will be distributed to appellants in proportion to 

their ownership interest in CCAH. Thus, they argue, the 

trustee is holding their interest in First American in trust for 

them as legal beneficiaries.

This contention fails for several reasons. If appellants 

were beneficiaries of the trust, it would appear to be improper for them to demand access to sealed court files. As they 

readily concede, "the law of trusts typically would require a 

beneficiary to seek access to the records of the trust from the 

trustee, rather than the Court." Appellants contend, however, that their request is properly before the court because the 

trustee, relying on the Procedural Order for support, has 

already rejected their request. Still, appellants did not file a 

motion to compel or a separate action for an accounting in 

response to this rejection. Nor have appellants alleged any 

wrongdoing on the part of the trustee, such as a breach of his 

fiduciary duties, to support such an action. See, e.g., Strauss 

v. Superior Court, 224 P.2d 726, 730-32 (Cal. 1950) (en 

banc). Furthermore, even as beneficiaries of the trust, appellants would not, presumably, be entitled to transcripts of the 

in camera conferences.

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Finally, as beneficiaries of the property administered by 

the RICO trustee, appellants would not be entitled to access 

to the sealed reports. By their own admission, they have 

already received all of the financial information they would 

require about the nature and amount of trust property. The 

trustee has regularly filed quarterly reports pursuant to the 

terms of his appointment and the Procedural Order, as well 

as two interim reports, all of which are available to the public. 

These reports contain statements of expenses, assets, and 

liabilities of First American and summaries of the trustee's 

efforts to sell First American's shares and assets. The sealed 

reports, on the other hand, only contain information about the 

financial reserves established by First American for claims 

including appellants' indemnification claims, as well as estimated expenses for handling those actions in the future. 

Appellants concede that the financial reserves reflect the full 

amount of those pending claims and therefore are already 

known to them. As beneficiaries, moreover, appellants would 

arguably have no right to view the "narratives" accompanying 

the reserve figures since they do not relate to the "nature and 

amount of the trust property." RESTATEMENT (SECOND) OF 

TRUSTS § 173.

Accordingly, finding no abuse of discretion by the district 

court, we affirm the order denying access to certain sealed 

material, transcripts of in camera conferences, and individualized notice of future filings in the criminal proceeding.

USCA Case #96-5317 Document #331135 Filed: 02/17/1998 Page 16 of 16