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Parties Involved:
Gene P. Dennison
Appellee
United States of America
Appellant

Document Text:

_ PUBLISH 

cUNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

Nos. 88-2802, 88-2805, 88-2806 

UNITED STATES OF AMERICA, ) 

) 

Plaintiff-Appellant, ) 

) 

V • ) 

) 

GENE P. DENNISON, ) 

DANA B. WILKERSON, JR. ) 

THOMAS C. HERRMANN, ) 

) 

Defendants-Appellees. ) 

FI LED 

Udt~<l Stat~~ C:mrc of Appca.l:s 

'!'e:1th Cin:uit 

· DEC 1 1989 

ROBER. T L. I10ECKER 

C!e!k 

Appeal from the United States District Court 

For the Eastern District of Oklahoma 

(D.C. No. 88-33-CR) 

Michael R. Lazerwitz (and Deborah Watson, Attorneys, Department of 

Justice, Washington, D.C.; Roger Hilfiger, United States Attorney, 

Eastern District of Oklahoma, with him on the brief), for 

Plaintiff-Appellant. 

Michael .J~ Fairchild, Attorney for Gene P. Dennison~ DeiendantAppellee. 

Julian K. Fite, Attorney for Dana B. Wilkerson, Jr., Defendant~ 

Appellee. 

Bruce Green of Green and Green, Muskogee, Oklahoma (Robert M. 

Butler, Tulsa, Oklahoma, with him on the brief), Attorneys for 

Thomas C. Herrmanni befenda~t-Appellee. 

Before BALDOCK, EBEL, and McWILLIAMS, Circuit Judges. 

McWILLIAMS, Circuit Judge. 

Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 1
In -a •· multi..-count indictment Dan L. S~efanoff, Gene P. · 

Dennison,-Dana B. Wilkerson, J:r.,·.and, Thomas c. Herrmann were 

charged with conspiring .to defraud Phoenix Federal Savings and 

Loan Association of Muskogee,-Oklahoma, an institution which was 

insured by the Federal Savings and Loan Insurance Corporation, and 

with otherwise obtaining monies of the Phoenix Federal Savings and 

Loan Association bi fraud, deceit and false representation. The 

gist of the several charges was that the defendants represented to . 

Phoenix that they had acquired, or were about to acquire, property 

near Denver, Colorado for a ~urchasa price of $4,000,000, and, in 

connection with such acquisition, defendants sought, and obtained, 

a loan from Phoenix in the amount of 80% of the _represented 

purchase . pr ice ($3,200,000), · whereas in fact they acquired the 

property in question for $2,lS0j000. 

Stefanoff entered into a plea agreement with the United 

States whereby the United States agreed not .to pursue other 

potential criminal matters against him in return for which 

Stefanoff agreed to plead gui1ty to charges of violating 18 u.s.c. 

§§ 371, ·1014-1006 and to testify as a government witness in• the 

trial of the remaining three defendants, who-had pled not guilty 

to all charges. 

Prior to trial# the.district court entered several discovery 

orders requiring government counsel to make available to defense 

counsel"' exculpatory evidence· in· t-heir possession. Similar orders 

were also entered after trial commenced. After the government had 

~alled several witnesses, but long before it would have rested its 

.case, the - defendants moved to dismiss ·the indictment on the 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 2
· ..... grounds·:that government· counsel' had fai·led · to - comply with the 

:-,district· court's several orders·- regarding discovery. , The district 

court agreed with defense counsel, characterizing government 

counsel, inter alia, as.being "green as a gourd," and dismissed 

the indictment in its entirety a~ to all three defendants. The 

government appeals·the three dismissal orders. The three appeals, 

which were separately briefed and argued, were companioned, but 

not consolidated, in this court. We reverse. 

The go~ernment appeal$ pursuant to 18 u.s.c. § 3731, which 

provides, in pertinent part, that in a criminal case the United 

States may appeal to· a. court of appeals from a judgment of a 

district court dismissing an indictment "except that no appeal 

shall lie where the double jeopardy clause of the United States 

·Constitution proh~bits further prosecution." The statute also 

provides that appeal in such cases shall be taken within thirty 

days after the judgment of dismissal has been entered and shall be 

"diligently prosecuted." 

All three d~fendants· filed motions to dismiss the 

government's appeal on the ground that the government has not 

"diligently prosecuted" its appeal in this court, and on the additional ground that the double jeopardy clau~e prohibits any 

retrial. We .are not persuaded. 

The district coutt dismissed the indictment on October 12, 

0

1988. The government filed its•·notice of·,appeal on November 10, 

1988, within the thirty-day period prescribed by 18 u.s.c. § 3731. 

· The trial-transcript was filed in the district qourt on January 

20, 1989,·- •·which -" triggered the·· setting of.:.a br-iefing . .s:c.hedule 

-3-

Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 3
wherein· the .government's ,,opening brie-f. was due-.'by March 1, 1989. 

The government sought, and obtained from:•us ,-A:wo- 30-day extensions 

of time within which to .file its opening brief, which was filed on 

April 28, 1989. Two of the three motions to dismiss were filed on 

May 26, 1989, and the other .was filed on June 2, 1989. The 

government •·s response to the motion to dismiss was filed on June 

16, 1989 .-

The _filing of a motion to di_smiss an appeal by the appellees 

tolled the filing of their briefs. By order of August 18, 1989, 

the appellees were ordered to file their briefs by September 8, 

1989, even though the motions to dism.iss the appeal were sti_ll 

pending. Herrmann filed his brief on September 7, 1989, and 

Wilkerson and Dennison filed separate briefs on September 8,. 1989. 

The government filed a reply brief on September 15, 1989. The 

case was orally argued before the court on September 27, 1989. 

The appellees concede that there is no "definite time 1imit" 

to determine whether the government has· "diligently prosecuted" an 

appeal under 18 . 1 u.s.c. § 3731. Appellees' "lack of diligence" 

1 In this regard, the defendants cite United States v. Jenkins, 

420 U.S. 358; 95 S. Ct. 1006~ 43 L.Ed.2d 250 (1975) and United 

States v. Goldstein; 479 F.2d 1061 (2d Cir. 1973). In Jenkins, 

the government's brief was not filed until six and one-half months 

after the notice of appeal. However, the Supreme Court in Jenkins 

noted·. that the defendant had not urged in either the Court of Appeals or the Supreme Court that there was a failure by the government t~ diligently prosecute its appeal. In Goldstein, the 

governm~nt did not file.its opening brief until six weeks after 

its notice of appeal. The Second Circuit in Goldstein in a 

footnote stated that, for appeals brought under 18 u.s.c. § 3731, 

30 days from the notice of appeal is the appropriate time limit 

within .which the government should file its opening brief. 

However, the Second Circuit in Goldstein did not reach the issue 

of whether the government had:~iligentl~ prosecuted its appeal and 

decided the appeal on a diffefent ~round. · 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 4
( argument is large·ly ·premised,· on the ·. fact that the government 

-obtained- from us two,0-~xtensions totalling sixty: days within whieh 

tp file its opening brief. We are not prepared to hold that such 

proves· a lack of diligence on the part of the government. Some 

delay occurred while the motions.to dismis~ were pending in this 

court. Such, however, is not attributable to the government. All 

thirigs considered, we believe the matter· ha~ been ·diligently 

pursued by all concerned in this court. 

Nor are we persuaded that there is merit to appellees' double 

jeopardy argument. The general rule is that wh~re a defendant in 

a criminal proceeding moves ·in mid-trial for a mistrial or 

dismissal on a basis unrelated to factual guilt or. innocence of 

the off~nse of which he is accused (in our case on the basis of 

prosecutorial misconduct consisting of non-complianc~ with 

discovery orders) and his request is granted, he suffers no injury 

cognizable under the oouble Jeopardy Clause if the government is· 

permitted to appeal from such ruling in favor of the defendant. 

United States v. Scott, 437 U.S. 82, 98-99, 98 S. Ct. 2187, 2197-

98, 57 L.Ed.2d 65, 78-79 (1978). 

A narrow exception to the general rule occurs where the 

defendant is pressured or goaded into seeking a mistrial or 

dismissal because of prosecutorial misconduct. As will be 

developed later, prosecutorial misconduct in the instant case was 

apparently the result· of·inexperience, and possibly carelessnes~, 

on the part of trial counsel for the government and was not a 

calculated move -by government ~ounsel to provoke defendants into 

~~q~~sting·<lismiss~l. rn eupport of the· for~going, see United. 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 5
States v~--.:. Dinitz, 424 U.S. ·600, .. 96 ·s., Ct. 1075, 47 L.Ed. 2d 267 

(1·976); 0United.States v. Po.e, -713 -,.F.2d· 579 {10th Cir .. 1983); 

·united States v. Martinez, 667 F.2d 886 (10th Cir. 1981); and 

United States v. Brooks, 599 F. 2d 943 ( 10th Cir. · 1979). In 

Dinitz, the Supreme Court spoke as follows: 

The Double Jeopardy Clause does protect a defendant 

against governmental actions intended to provoke 

mistrial requests and thereby. to subject -defendants to 

the substantial burdens imposed by multiple prosecutions. It bars retrials where "bad faith conduct by 

judge or prosecutor," United States v. Jorn, supra at 

485, threatens the "[h]arassment of an accused by successive prosecutions or declaration of a mistrial so as 

to afford the prosecution a more favorable opportunity 

~o con~ict" the defendant (citations omitted). 

For the reasons above stated, appellees: motions to dismiss 

will be denied. 

As indicated, after trial commenced and several government 

witnesses had testified, the district court granted the defendants' renewed motions to dismiss the indict~ent because of the 

failure of the prosecutor to ~omply with the several discovery 

orders of the district court requiring the prosecutor to give to 

defense counsel any evidence in his custody or under his· cont'rol 

which might tend to impeach a government witness ot might 

otherwise tend to exculpate the defendants. In so doing, the 

district court commented, inter alia, that the government's 

failure to comply had been "whol~sale and ongoing" and in ''bad 

faith," -and that anything less than an outright dismissal, as opposed ~o a mistrial, would "penalize the defendants for being here 

and being ready for ~ri~l. 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 6
The ,government's basic·position is.that although.it did not 

fully and· promptly· comply with all -'discovery orders, such .. vioJ_~-

tions of discovery orders did not warrant the extreme sanction of 

dismissal of the indictment. Appellees' basic position is· that 

the prosecutor's repeated violation~_of the distr1ct court's order 

were so egregious that dismissal of the indictment was proper. We 

are in accord with the government's analysis of the matter. 

At the outset~ the district court's characterization of the 

prosecutor's conduct as being the result of "bad faith" is simply 

not borne out by the record before us--inexperience ·on the part of 

the prosecutor, and perhaps carelessness, but not bad faith. 

Indeed, at one point in the proceeding the district court inquired 

of the prosecutor, who was apparently handling the case by 

himself, as to how many trials in federal court he had 

participated inj and the prosecutor's answer that this was only 

· his second trial was the basis for the district court's 

characterization of counsel as being "gree_n as a gourd. 11 We find 

nothing in the record to support the district court's finding that 

the prosec·utor acted in "bad faith." 

Fed •. R. Crim. P. 16(d)(2) provides as follows: 

(2) Failure to comply with a Request. If at any 

time during thi course of the proceedings it is brought 

to the attention of the court that a party has failed to 

comply with thia rule, the court may order such party to 

permit the discovery or inspection, grant a contin~ance, 

or prohibit the party from introducing evidence not 

disclosed, ·or it may enter such other order as it deems 

just under the circumstances. The court may specify the 

time, place and manner of making· the discovery and 

inspection and m~y prescribe such terms and conditions 

as are just •. 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 7
·· In United States v. ·Peveto; 88:l F.2d 8,44·_. (10th Cir. 1989), 

.the district judge, ~who -coincidentally is the·same.judge who 

presided in the instant case, determined that the government had 

failed to provide defense counsel with important evidence until 

the day trial commenced, in clear violation of discovery orders, 

and, as a sanction, granted the defendant a two weeks continuance~ 

In so doing, the district judge rejected the suggestion that the 

evidence be excluded, as is permitted by Fed. R. Crim. P. 

16(d){2). The district judge in Peveto also rejected the. suggestion that the iridictment be dismissed because of the government•~ 

failure to_ comply with discov·ery orders, commenting that the 

interest of justice would not be "served well by dismissal o·f such 

a serious matter, because of some misdeeds by the government." 

After the two· weeks continuance, the· jury in. Peveto 

reconvened and the trial proceeded through to conclusion, with the 

defendants being found guilty. On appeal, the appellants argued 

that the-district judge erred in not dismissing the indictment and 

imposing only a sanction of a two-week continuance. We upheld the 

sanction imposed by·the district judge, stating that there was no 

~buse of discretion in refusing to impose the extreme sanction of 

dismissal. !n so doing, we spoke as· follows: 

The Federal Rules of Criminal Procedure give trial 

courts broad discretion in imposing sanctions on a party 

who fails to comply with a discovery order: 

-If at any time during the course of the 

proceedings it is brought to the attention of 

the court that a par·ty has failed to comply 

with this rule, the court may order such party 

_to permit the discovery or inspection, grant a 

continuance, or prohibit the party from 

introducing evidence not disclosed,.: or it .. .may 

enter such other ordet as it ~eems just under 

-8-

Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 8
the .: circumstances. The·· court may ·specify the 

time, plac~ and manner of making the discovery 

and inspection and may· pr-escribe s-uch terms 

and conditions as are just. 

Fed. R. Crim. Proc. 16 (d)(2). See United States 

Wicker, 848 F.2d 1059, 1060 (l0th·Cir. 1988); United 

States v. Fernandez, 780- F.2d 1573, 1576 · (11th Cir. 

1986). The district court's exercise of discr~tion is 

governed by several factors: 

When the government fails to comply with a 

discovery order, the factors the district 

court should consider in determining if a 

sanction is appropriate are (1) the reasons 

the government delayed producing the requested 

materials, including whether or not the 

government acted in bad faith when it failed 

to comply with the discovery order; (2) the 

extent of prejudice to the defendant as a 

result of the government's delay; and (3) the 

feasibility of curing the prejudice with a 

continuanc~. United. States v. EucedaHernandez, 768 F.2d 1307, 1312 (11th Cir. 

1985); Fernandez, 780 F.2d at 1576. 

Wicker, 848 F.2d at 1061. If a sanction is imposed, it 

should be the "least severe sanction ·that will .accomplish prompt and full compliance with the 

court's discovery orders." Id. at 1060 (quoting 

Fernandez, 780 F.2d at 1576)~-Cf. Bank of Nova Scotia 

v. United- States, 487 U.S. 250, 1~ S. Ct. 2369, 101 

L.Ed.2d 228 (1988) (holding that as a general rule a 

district court exceeds its supervisory power in dismissing an indictment for prosecutorial misconduct not 

prejudici~l to the defendant ftnd noting that many errors 

may be remedied by means other than dismissal). "A 

continuance may normally be the most desirable remedy_ 

for the government's failure to comply with a discovery. 

order." Wicker, 848 F.2d at 1062. 

Our study of the matter. 6onvinces us that the district court 

abused its discretion in dismissing the indictment because of the 

·government's failure to comply with discovery orders. Under the 

circumstances, it should have opted for a lesser sanction. A duly 

returned grand jury indictment -should not be dismissed for 

_~subsequent· conduct-.. - of a·-gover:nmenLattorney of· the- type involved 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 9
in the· instant case. The reason' for· the··.government I s. failure . to 

· fully · and promptly· comply with the district court's discovery 

orders is attributable to counsel's relative inexperience. As 

indicated, there is .nothing in the record to indicate bad faith. 

Nor has prejudice been shown. Defense counsel apparently .knew 

about many, if not all, matters they were attempting to obtain 

from government counsel. And at the moment that the indictment 

was dismissed, it would appear that government counsel had 

substantially bomplied with all discovery orders. 2 ·Government 

counsel obviously vexed the district judge, but that fact does not 

justify outright dismissal of the indictment. 

Our attention has not been directed to any Tenth Circuit case 

where we upheld a district court's dismissal of an indictment 

becaus~ of prosecutorial misconduct •. For Tenth Circuit cases 

where we reversed a district _court's dismissal of an indictment on 

the basis of prosecutorial misconduct, see United States v. 

Ki 1 pat r i ck , 8 21 F • 2 d 14 5 6 ( 1 O th Ci r • 19 8 7 ) ( a ff I d 4 8 7' U • S • 2 5 O ) ; 

United State~ v. Anderson, 778 F.2d 602 (10th err. 1985): United 

States v. Drake, 655 F.2d 1025 (10th clr. 1981). 

Nor has our attention 6een directed to any Tenth Circuit case 

where we ever reviewed a dismissal of an indictment by a district 

court on the basis of a violation by government counsel of 

2 Prior to and during the trial, the government turned over 

considerable material to the defendants that would conceivably 

impeach the key government witness, including a number of FBI 302 

reports (witness statements), records of other loans with which 

the key witness was involved, and a letter written to Phoenix from 

another member of the partnership who would later testify for the 

government. Defendants, on appeal, have not shown how they would 

have ,,i)een• prejudiced if ·required to continue with the trial after 

receiving the requested materials from the government. 

-10-

........ 

'·-~ 

Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 10
( ·discovery·ord~rs~ In United States v.·.Jacobs, 855 F.2d · 652 (9th 

Cir. 1988), the Ninth Ci~cui.t .reversed .,a district court's 

dismissal of an indictm~nt because of a violation by government 

counsel of discovery orders. In so doing, the Ninth Circuit said 

that dismissal of an indictment on the basis of prosecutorial 

misconduct is proper only if the ~isconduct is "flagiant'' and 

causes "substantial prejudice'' to the defendant. And in United 

States v. Anderson, supra, where the alleged prosecutorial 

misconduct did not involve discovery orders but involved the allegedly improper handling of the grand jury, we opined that 

instances where an appellate court has upheld a district court's 

dismissal of an indictment because of alleged prosecutorial 

misconduct are "few and far b~tween." 

The appellees' motions to dismiss are denied. The judgments 

dismissing the indictment are reversed and the matter remanded to 

the district court with direction that .the indictment be 

reinstated in its entirety as to all appellees. 

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Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 11
( 

Appellate Case: 88-2802 Document: 010110280401 Date Filed: 12/01/1989 Page: 12