Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-10579/USCOURTS-ca9-13-10579-0/pdf.json

Parties Involved:
David M. Mark
Appellant
United States of America
Appellee

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

v.

DAVID M. MARK,

Defendant-Appellant.

No. 13-10579

D.C. No.

2:11-cr-00453-

PMP-CWH-1

OPINION

Appeal from the United States District Court

for the District of Nevada

Philip M. Pro, Senior District Judge, Presiding

Argued and Submitted

March 9, 2015—San Francisco, California

Filed July 31, 2015

Before: M. Margaret McKeown, Mary H. Murguia, and 

Michelle T. Friedland, Circuit Judges.

Opinion by Judge Friedland;

Concurrence by Judge McKeown

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2 UNITED STATES V. MARK

SUMMARY*

Criminal Law

The panel reversed the district court’s denial of the 

defendant’s motion to reconsider its denial of the 

defendant’s motion to dismiss the indictment, and 

remanded with instructions to dismiss the indictment, in a 

case in which the parties agreed that the defendant was 

given immunity in exchange for his cooperation in a 

mortgage-fraud investigation.

The panel held that in light of the scant record 

supporting the government’s claim that the defendant 

breached the immunity agreement (and was therefore 

amenable to prosecution) and clear evidence that key 

details of the government’s story were inaccurate, the 

district court abused its discretion when it failed to either 

grant the defendant’s motion for reconsideration or order an 

evidentiary hearing. 

Concurring, Judge McKeown wrote separately to 

emphasize that this case is a textbook lesson in the 

importance of documentation with regard to immunity 

deals.

 * This summary constitutes no part of the opinion of the court. It has 

been prepared by court staff for the convenience of the reader.

 

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UNITED STATES V. MARK 3

COUNSEL

Michael S. Fawer (argued), Smith & Fawer, Covington, 

Louisiana, for Defendant-Appellant.

Peter S. Levitt (argued), Assistant United States Attorney, 

Daniel G. Bogden, United States Attorney, Elizabeth O. 

White, Appellate Chief, United States Attorney’s Office, 

Las Vegas, Nevada, for Plaintiff-Appellee.

OPINION

FRIEDLAND, Circuit Judge:

When the government promises not to prosecute a 

witness in exchange for his cooperation, it cannot then 

indict the witness unless it proves that he failed to 

cooperate. Because the government did not do so here, we 

remand with instructions to dismiss the indictment.

I.

From 2006 to 2007, Defendant David Mark and his 

then-girlfriend Kimberly Brown were employed by 

Distinctive Real Estate and Investments, a company run by 

Eve Mazzarella in Las Vegas. During Mark’s tenure, the 

FBI began investigating Distinctive Real Estate, 

Mazzarella, and her husband Steven Grimm in connection 

with a large-scale mortgage-fraud scheme.

In November 2007, Brown and Mark voluntarily 

reached out to the FBI and provided information to assist in 

its investigation. A few months later, in March 2008, 

Assistant U.S. Attorney Brian Pugh interviewed Brown and 

Mark to determine whether they would be good witnesses 

in a potential trial against Grimm and Mazzarella. At the 

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4 UNITED STATES V. MARK

end of this interview, Mark expressed concern about what 

was going to happen to him. Pugh assured Mark and 

Brown that, as long as they cooperated with the 

government, they would not be prosecuted. Pugh later 

acknowledged that his statement created informal immunity 

agreements with both witnesses.1

In February 2011, Pugh called Mark to go over his 

testimony in preparation for the upcoming MazzarellaGrimm trial. Assistant U.S. Attorney Sarah Griswold and 

an FBI agent also participated in the call, which was made 

to Mark’s cell phone and lasted approximately an hour. 

The FBI agent produced a report memorializing the 

discussion. For reasons unrelated to Mark, the trial was 

later postponed, so he was not called to testify.

In August 2011, Mark received a target letter informing 

him that he faced the possibility of indictment in 

connection with the mortgage-fraud scheme. In response to 

the letter, Mark hired an attorney who immediately 

contacted the prosecutors to set up a meeting. After 

unsuccessful plea negotiations during which Mark’s 

immunity deal was never mentioned, Mark was charged 

with five counts of bank fraud; one count of mail fraud; and 

one count of conspiracy to commit bank fraud, mail fraud, 

and wire fraud.

Mark’s trial began in March 2013. During Kim 

Brown’s testimony, she explained that in 2008 Pugh had 

promised her and Mark immunity from prosecution as long 

 1 Brown’s immunity agreement was at issue in United States v. 

Mazzarella, 784 F.3d 532, 538 (9th Cir. 2015).

 

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UNITED STATES V. MARK 5

as they cooperated with the government. According to 

Mark’s attorney, this was the first time he had heard about 

Pugh’s promise. Three days later, Mark filed a motion to 

dismiss the indictment based on the informal immunity 

agreement.

The district court suspended the trial and held a hearing 

to determine whether Mark was immune from prosecution. 

Pugh and Griswold both testified that they called Mark in 

July 2011 to go over his testimony in preparation for the 

rescheduled Mazzarella-Grimm trial. The prosecutors 

recounted that, unlike when they spoke to Mark in February 

2011, Mark was suddenly uncooperative and pretended not 

to remember anything. Pugh explained that they initiated 

the July 2011 call “us[ing] a speakerphone” in a conference 

room in the U.S. Attorney’s Office, and reached Mark “at 

his telephone number that [they] had from prior 

interviews,” an account with which Griswold agreed. Pugh 

further testified that an FBI agent was present during the 

call, and that, although he could not specifically remember 

which agent it was, he “believe[d] it was Sean Jones, 

because [Jones] was the case agent at the time.” Agent 

Jones testified, however, that he could not recall being part 

of a July 2011 phone call. Pugh acknowledged that the 

U.S. Attorney’s Office had no notes or other records of the 

call, but he testified that he sent the August 2011 target 

letter in response to the call. Mark, on the other hand, 

testified that the July call never occurred, and that he had 

no calls with Pugh between February and his receipt of the 

target letter in August.

Ruling from the bench, the district court denied Mark’s 

motion to dismiss. The judge credited the testimony of 

Pugh and Griswold and found that the July call happened as 

they described.

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6 UNITED STATES V. MARK

Mark’s trial continued. At the conclusion of the trial, 

the jury convicted Mark on multiple counts.

Shortly thereafter, Mark sought reconsideration of his 

motion to dismiss the indictment based on new evidence. 

After hearing the prosecutors’ testimony about the alleged 

July call, Mark had subpoenaed phone records between the 

U.S. Attorney’s Office and Mark’s cell phone, and had now 

received those records. Although the records confirmed the 

February call, there were no entries showing a call to Mark 

in July. Mark argued that the new evidence undermined 

the prosecutors’ testimony and that the district court 

therefore should reconsider its denial of the motion to 

dismiss.

The district court denied Mark’s motion to reconsider, 

holding that there were “no sufficient grounds presented to 

warrant [a] further evidentiary hearing or reconsideration of 

[the] Court’s previous Order denying Defendant’s motion 

to dismiss.”

II.

A. Standard of Review

We review rulings on reconsideration motions for abuse 

of discretion. See United States v. Tapia-Marquez, 

361 F.3d 535, 537 (9th Cir. 2004). A district court abuses 

its discretion if it does not apply the correct legal standard 

or if it rests its decision on a clearly erroneous finding of 

fact. See United States v. Hinkson, 585 F.3d 1247, 1261-62 

(9th Cir. 2009) (en banc).

B. Analysis

The parties agree that Mark was given immunity in 

exchange for his cooperation. The dispute here is whether 

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UNITED STATES V. MARK 7

Mark breached the immunity agreement and thus made 

himself amenable to prosecution.

In order to deny the motion to dismiss the indictment, 

the district court had to find that Mark breached the 

immunity agreement. See United States v. Carrillo, 

709 F.2d 35, 37 (9th Cir. 1983) (“[B]ecause [the defendant] 

fulfilled all . . . obligations under the agreement, under 

settled notions of fundamental fairness the government was 

bound to uphold its end of the bargain.”). As the 

government conceded at oral argument, it had the burden of 

proving that Mark breached. See United States v. Fitch, 

964 F.2d 571, 574 (6th Cir. 1992) (“If [an immunity] 

agreement has been entered into, the government bears the 

burden of proving that the defendant failed to satisfy his 

part of the deal.”); see also United States v. Packwood, 

848 F.2d 1009, 1011 (9th Cir. 1988) (holding that the 

government has the burden of proof to show breach of a 

plea agreement). The government must prove a breach of 

an immunity agreement by a preponderance of evidence. 

See United States v. Castaneda, 162 F.3d 832, 836 (5th Cir. 

1998); United States v. Meyer, 157 F.3d 1067, 1078 (7th 

Cir. 1998); United States v. Gerant, 995 F.2d 505, 508 (4th 

Cir. 1993); see also Packwood, 848 F.2d at 1011 (requiring 

that the government show the defendant breached a plea 

agreement by a preponderance of evidence).

Initially, the district court accepted the prosecutors’ 

account that Mark suddenly became uncooperative during a 

July call—an account that did, when credited, support the 

finding that Mark had breached the immunity agreement. 

In his motion to reconsider, however, Mark presented 

phone records that contradicted the prosecutors’ testimony 

about the July call. The district court did not explain why, 

despite the new phone records, it chose not to hold a further 

evidentiary hearing or otherwise reconsider its earlier order 

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8 UNITED STATES V. MARK

denying the motion to dismiss. In light of the scant record 

supporting the government’s claim of a breach and clear 

evidence that key details of the government’s story were 

inaccurate, the district court abused its discretion when it 

failed to either grant Mark’s motion for reconsideration or 

order an additional evidentiary hearing.

The government’s only evidence of breach was 

testimony by Pugh and Griswold that Mark became 

uncooperative during a July 2011 phone call. The 

prosecutors testified that they and an FBI agent made the 

call to Mark’s cell phone from a speakerphone in a 

conference room at the U.S. Attorney’s Office. That 

account, however, is directly contradicted by the phone 

records that Mark presented in his motion to reconsider. 

The records show that there were no calls between the U.S. 

Attorney’s Office and Mark’s cell phone during the month 

of July.

The absence of phone records corroborating the July 

call stands in stark contrast with the February call. Both 

sides agree that Pugh, Griswold, and an FBI agent 

interviewed Mark over the phone in February 2011 in 

preparation for the Mazzarella-Grimm trial. The phone 

records show a call on February 1 from the U.S. Attorney’s 

Office to Mark’s cell phone that lasted approximately an 

hour, as well as several shorter calls the day before.

The February conversation was also memorialized in a 

report prepared by the FBI agent who participated in that 

call. The July call, on the other hand, which purportedly 

had the same trial-preparation purpose, was not 

memorialized by the prosecutors or by any FBI agent. The 

government did not dispute at oral argument that the usual 

practice in the U.S. Attorney’s Office was to keep notes 

during any such interview. Here, however, there are no 

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UNITED STATES V. MARK 9

notes from a July call, and the FBI case agent at the time 

testified that he had no recollection of such a call. The 

government has failed to supply an explanation for either of 

these gaps in the record.

The government also did not dispute at oral argument 

that a target letter to a witness who previously had an 

immunity deal would ordinarily describe the defendant’s 

breach. But the target letter Mark received does not 

mention a July call, or any other instance of a breach, to 

explain why the government suddenly considered Mark a 

target rather than a cooperating witness.

Perhaps at a further evidentiary hearing the prosecutors 

could have reconciled their recollections that a call 

happened with all of the apparent evidence to the contrary. 

But the government has urged us not to remand for an 

evidentiary hearing and instead has expressed a desire to 

stand on the existing record. When asked whether 

remanding the case for a further evidentiary hearing would 

be appropriate, the government attorney stated: “I can’t 

imagine that at a further evidentiary hearing . . . that 

anything else is going to get unearthed.” When pressed 

further on whether the government would “stake its claim” 

on the existing record, he answered “correct.” We 

therefore evaluate whether, on the current record, the 

government met its burden of proving that Mark breached.

The government’s only affirmative evidence of a 

breach is the testimony of Pugh and Griswold, which was 

directly contradicted by the phone records. This is 

insufficient to prove that Mark stopped cooperating during 

a July call, particularly in light of the lack of any notes 

memorializing a call or any mention of a call in the target 

letter. This is troubling because the government made clear 

at oral argument that it is the typical practice of the office 

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10 UNITED STATES V. MARK

to keep such records.2 Cf. Fed. R. Evid. 803(7) (providing 

that the “Absence of a Record of a Regularly Conducted 

Activity” may be evidence that “the matter did not occur or 

exist”). In light of the gaps and contradictions in the 

record, the district court’s failure to either grant Mark’s 

motion for reconsideration or order an additional 

evidentiary hearing was an abuse of discretion.3

III.

For the foregoing reasons, we reverse the district 

court’s denial of Mark’s motion to reconsider and remand 

with directions to dismiss the indictment.

REVERSED and REMANDED.

McKEOWN, Circuit Judge, concurring:

The opinion, which I join in full, aptly describes why 

the government failed to meet its burden of proving that 

Mark breached his informal immunity agreement with 

federal prosecutors. I write separately to emphasize that 

 2 At oral argument, the government also acknowledged that it had 

searched the phone records for calls between the U.S. Attorney’s Office 

and any number in Louisiana, which is where Mark’s cell phone was 

registered and where he had lived after leaving Las Vegas, but had 

found nothing.

 3 Mark raised two other issues on appeal. Because we are remanding 

with instructions to the district court to dismiss the indictment, we need 

not reach those additional issues.

 

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UNITED STATES V. MARK 11

this case is a textbook lesson in the importance of 

documentation with regard to immunity deals. When it 

comes to proving breach of an immunity agreement, the 

government should do better than “he said, she said.”

The government routinely enters into agreements in 

which it promises leniency in exchange for cooperation 

with an investigation or prosecution. The threshold 

question of whether a deal was made in the first place is 

often the subject of dispute. See, e.g., United States v. 

Aleman, 286 F.3d 86, 90 (2d Cir. 2002) (noting the parties’ 

“failure to agree on the existence” of an agreement); United 

States v. Thompson, 25 F.3d 1558, 1562 (11th Cir. 1994) 

(evaluating an “alleged oral grant of immunity”). Here, the 

government candidly acknowledges it made such an 

agreement directly with Mark, though it inexplicably failed 

to disclose the existence of the agreement to his counsel, 

who learned about it by happenstance while questioning 

another witness at Mark’s trial.

Granting immunity is a big deal. Claiming that a 

defendant breached the agreed-upon terms is an equally big 

deal. Prosecuting someone who was previously granted 

immunity implicates “more . . . than just the liberty of [a] 

defendant. At stake is the honor of the government[,] 

public confidence in the fair administration of justice, and 

the efficient administration of justice in a federal scheme of 

government.” United States v. Carter, 454 F.2d 426, 428 

(4th Cir. 1972) (en banc). Failure to document the breach, 

even with something as simple as a file note, a memo, or a 

reference in the target letter is dumbfounding. See United 

States v. Harvey, 869 F.2d 1439, 1443 (11th Cir. 1989) (en 

banc) (“[T]his appeal would not be necessary had the 

United States Attorneys . . . reduced their agreement . . . to 

writing.”).

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12 UNITED STATES V. MARK

When the government alleges breach stemming from 

the failure to cooperate sufficiently, a typical response is 

that the defendant complied with the literal terms of the 

deal. See, e.g., Ricketts v. Adamson, 483 U.S. 1, 11 (1987) 

(noting that the defendant’s argument that his plea 

agreement did not require him to testify was “an 

interpretation of the agreement that proved erroneous”); 

United States v. Floyd, 1 F.3d 867, 868-70 (9th Cir. 1993) 

(highlighting the difference between an agreement that 

requires a defendant to “testify fully and truthfully” and an 

agreement that requires her to “cooperate”); United States 

v. Irvine, 756 F.2d 708, 710-11 (9th Cir. 1985) (per curiam) 

(holding that defendant’s malfeasance constituted a breach 

notwithstanding his accurate “testimony” because the 

agreement proscribed any and all “deception”). This case 

tracks that pattern in the broadest sense: Mark claims that 

he complied with the terms of his immunity agreement by 

cooperating with the government’s investigation, while the 

prosecutors maintain that he breached by giving evasive 

and contradictory answers to their questions.

In its details, however, this case is far from typical. 

Specifically, the government claims that Mark breached the 

immunity agreement during a July 2011 phone call with 

two Assistant United States Attorneys and an FBI agent. 

Unlike a defendant who attempts to characterize his lessthan-complete cooperation as compliance with the literal 

terms of an agreement, Mark disputes the very event—the 

phone call—that prosecutors assert is the genesis of the 

breach. Mark says that this phone call never took place at 

all.

The government bears the burden of proving the 

breach. Slip Op. 7. When confronted with contradictory 

evidence about whether a breach occurred, the district court 

must make factual findings about the defendant’s 

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UNITED STATES V. MARK 13

compliance. See Floyd, 1 F.3d at 871. As a threshold 

matter, the government needed to prove that a call between 

prosecutors and Mark took place in July 2011. Absent a 

phone call, the claim of breach collapses. Two prosecutors 

testified that they and an FBI agent called Mark. Mark 

denied that the call took place, and the FBI agent testified 

that he had no recollection of the call. While the district 

court is generally entitled to base its rulings on the 

credibility of witnesses, this case takes on a different patina 

due to the absence of any documentary evidence about the 

call itself, let alone the content of the supposed breach.

It is undisputed that the prosecutors spoke with Mark in 

February 2011 as part of their preparation for the 

Mazzarella-Grimm trial. Fast forward only five months 

and the prosecutors were in the throes of preparing for the 

trial that had been continued. In contrast to the welldocumented February call, which was memorialized in 

phone records and a follow-up memo by an FBI agent, the 

purported July call yielded no records. It is difficult to 

conceive that a trial preparation call involving two 

attorneys, one FBI agent, and a key witness in a multimillion dollar fraud case would not trigger a substantial 

paper trail or at least a scrap of documentary evidence. But 

here, neither the prosecutors nor the FBI could find any 

notes, correspondence, or other documents verifying that a 

call had taken place, let alone the results of the call. See 

Harvey, 869 F.2d at 1443 (describing the government’s 

failure to take notes during witness interviews as 

“astonishing”). The only near-contemporaneous document 

the government produced—the target letter sent to Mark in 

August 2011—contains no reference to a July call. The 

absence of any notes or documentation coupled with 

complete silence in the target letter is nothing short of 

remarkable.

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14 UNITED STATES V. MARK

In light of this abysmal record, the district court was 

forced to base its ruling on little more than a swearing 

contest. Interestingly, the swearing contest pitted the 

prosecutors against not just Mark but also an FBI agent 

who had no recollection of the call. Significantly, the court 

did not make an adverse credibility finding regarding Mark. 

Following the district court’s initial ruling, Mark requested 

that the government produce phone records to corroborate 

that the call took place. In response, the government for 

the first time attempted to reconstruct evidence of the call. 

The government’s belated search for phone records, 

however, demonstrated that the central details of the 

prosecutors’ testimony were inaccurate: no call was placed 

from the United States Attorneys’ office to Mark’s cell 

phone in July 2011. At that point, the district court should 

have dismissed the indictment or granted a new evidentiary 

hearing. Notably the government has now eschewed any 

suggestion of another evidentiary hearing.

Whenever a defendant is prosecuted after having been 

given immunity, it is eminently foreseeable that he will 

advance every legitimate argument that his immunity 

should have remained intact. Cases involving oral grants of 

immunity and undocumented breaches “create confusion 

for the government and for the courts.” Harvey, 869 F.2d 

at 1443. Contemporaneous documentation is thus critical 

to detail the scope and terms of the agreement and equally 

critical to establish whether a breach occurred. Setting up a 

claim of breach without any documentation puts the court 

and counsel in the unenviable position of reconstructing a 

breach solely through a swearing contest and a hypothetical 

reimagining of events. To be sure, the government holds 

the cards in such a situation. But when the defendant’s 

liberty rests on those cards, common sense, fairness, and 

confidence in the system demand more. I therefore concur 

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UNITED STATES V. MARK 15

in the opinion remanding with instructions to dismiss the 

indictment.

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