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Parties Involved:
Evans & Associates Construction Co., Inc.
Appellee
United States of America
Appellant

Document Text:

PUBLISH 

.FILED 

'mted Statoo Court of Aopea1, ....,,,._,.,. 1"'1! ........... :.,- - J 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

FEB 17 1988 

ROBER'l, L. HO~CKER 

UNITED STATES OF AMERICA, 

Plaintiff-Appellant, 

v. 

EVANS & ASSOCIATES 

CONSTRUCTION CO., INC. 

and LLOYD I. EVANS, 

Defendants-Appellees. 

87-1331 

87-1332 

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Clerk · 

Appeal From The 

United States District Court 

For The Western District 

Of Oklahoma 

(D.C. No. CR-86-77-E) 

David Seidman, Attorney, Department of Justice, Washington, D.C. 

(Charles F. Rule, Acting Assistant Attorney General, Kenneth G. 

Starling, Deputy Assistant Attorney General, John J. Powers, III 

and Laurence K. Gustafson, Attorneys, Department of Justice, 

Washington, D.C., Kent A. Gardiner and Alan A. Payson, Attorneys, 

Department of Justice, Dallas, Texas, with him on the briefs), for 

Plaintiff-Appellant. 

B. J. Rothbaum, Jr. of Linn & Helms, Oklahoma City, Oklahoma 

(Brinda K. White of Linn & Helms, Oklahoma City, Oklahoma, 

David Kline and Richard Coulson of Kline & Kline, Oklahoma City,. 

Oklahoma, with him on the brief), for Defendant-Appellee. 

Before SEYMOUR, SETH and BALDOCK, Circuit Judges. 

SETH, Circuit Judge. 

Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 1 
This appeal is taken from an order of the United States 

District Court for the Western District of Oklahoma dismissing in 

its entirety a three count indictment against appellees as a 

sanction. The indictment charged appellees with violating Section 

One of the Sherman Anti-Trust Act, 15 u.s.c. § 1, the mail fraud 

statute, 18 u.s.c. § 1341, and the Racketeer Influenced and 

Corrupt Organizations Act ("RICO''), 18 U.S.C. § 1962(c), in 

connection with the award of an Oklahoma highway construction 

contract. The United States as appellant contends that the trial 

court abused its discretion in granting appellees' motion for 

discovery and erred in dismissing Count One as time barred. 

Evans and Associates (Evans) was a construction company. 

Beginning as early as September 1979 and continuing at least 

through April 1981 it was charged that appellees and other unnamed 

coconspirators agreed among themselves who would be the lowest 

bidder for the Noble County project the Oklahoma Department of 

Transportation was awarding. The contract was awarded in 1979. 

On April 21, 1986 a grand jury for the Western District of 

Oklahoma returned the indictment here concerned. 

Appellees made a number of discovery motions and also moved 

to dismiss Count One as being barred by the five-year statute of 

limitations. One of the discovery motions requested that pursuant 

to Rule 6(e) of the Federal Rules of Criminal Procedure the court 

make available transcripts of testimony presented to the grand 

jury. The court granted appellees' motion to dismiss Count One on 

the limitations issue. In addition, the court made a number of 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 2 
scheduling orders because it appeared that the trial would begin 

in about thirty-five days. The court granted appellees' Rule 6(e) 

motion and directed the Government to provide Evans within seven 

days (October 23, 1986) the grand jury transcripts that were 

already transcribed and all other testimony no later than ten days 

before the start of the trial. 

Rather than turn over the transcribed material on October 23 

the Government filed a motion for the court to reconsider the 

production order. The Government stated that it was willing to 

disclose the statements of all Government witnesses ten days 

before trial; that it would furnish all exculpatory material 

pursuant to Brady v. Maryland, 373 U.S. 83, and that it had 

already provided appellees with transcripts of their own grand 

jury testimony and those of employees in a position to legally 

bind them. The court reconsidered but reaffirmed its earlier 

decisions. During the hearing the Government notified the court 

that it was going to appeal the dismissal of Count One of the 

indictment and also that it would not comply with the court's 

disclosure order. The Government requested that the court impose 

sanctions in order for it to have an order to appeal. As a 

sanction the court dismissed the entire indictment and the 

Government filed this appeal. 

The Government contends the court abused its discretion when 

it granted appellees' motion requesting transcripts of testimony 

given before the grand jury because appellees failed to 

demonstrate a particularized need for the material. 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 3 
When the court was called upon to determine whether the grand 

jury transcripts should be released it had substantial discretion 

to order or to deny release. Douglas Oil Company of California v. 

Petrol Stops Northwest, 441 U.S. 211. We said in United States v. 

Warren, 747 F.2d 1339, 1347 (10th Cir.): "There is a 'longestablished policy that maintains the secrecy of the grand jury 

proceedings in the federal courts.'" This is necessarily the 

starting position. The Supreme Court had stated this policy as it 

observed in Douglas Oil Company: 

"In particular, we have noted several distinct 

interests served by safeguarding the 

confidentiality of grand jury proceedings. 

First, if preindictment proceedings were made 

public, many prospective witnesses would be 

hesitant to come forward voluntarily, knowing 

that those against whom they testify would be 

aware of that testimony. Moreover, witnesses 

who appeared before the grand jury would be 

less likely to testify fully and frankly, as 

they would be open to retribution as well as 

to inducements. There also would be the risk 

that those about to be indicted would flee, or 

would try to influence individual grand jurors 

to vote against indictment. Finally, by 

preserving the secrecy of the proceedings, we 

assure that persons who are accused but 

exonerated by the grand jury will not be held 

up to public ridicule." 

441 U.S. at 218-19. 

Nevertheless, there are instances where disclosure of grand 

jury testimony is warranted. As the Supreme Court noted in Dennis 

v. United States, 384 U.S. 855, 870, as to variations to the 

doctrine: 

"These developments are entirely consonant 

with the growing realization that disclosure, 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 4 
rather than suppression, of relevant materials 

ordinarily promotes the proper administration 

of criminal justice." 

The Federal Rules of Criminal Procedure have provided an exception 

to the general rule of secrecy with the courts acting as guardians 

of the grand jury transcripts, and not the United States Attorney. 

Thus the Federal Rule of Criminal Procedure 6(e)(3)(C)(i) states: 

"(C) Disclosure otherwise prohibited by this 

rule of matters occurring before the grand 

jury may also be made--

(i) when so directed by a court 

preliminarily to or in connection with a 

judicial proceeding." 

The trial court must exercise its discretion in determining 

whether the testimony should be disclosed. United States v. 

Warren, 747 F.2d 1339, 1347 (10th Cir.); United States v. Cronic, 

675 F.2d 1126, 1130 (10th Cir.), rev'd on other grounds, 466 U.S. 

648; In re September 1975 Grand Jury Term, 532 F.2d 734, 737 (10th 

Cir.); United States v. Parker, 469 F.2d 884, 889 (10th Cir.). 

The party seeking disclosure must demonstrate that disclosure 

is sought preliminarily to or in connection with a "judicial 

proceeding," and that there is a particular, not a general, need 

for the material. The rule is not to be used as a substitute for 

general discovery. The party seeking disclosure must demonstrate 

that the need for disclosure outweighs the need for secrecy. 

In the instant case, appellees gave these specific reasons 

why they needed the material: the passage of time between the 

events alleged, some events occurred nearly twenty years ago; the 

grand jury testimony was the only source of "fresh" testimony 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 5 
available; there would be no interference with an ongoing 

investigation; the complexity of the charges; the number of 

potential witnesses; the volume of testimony heard by the grand 

jury; and finally, because the testimony would be extremely 

helpful to Evans in preparing its case because the testimony 

consisted of statements made by witnesses who testified in support 

of the conspiracy and much of their testimony would be 

uncorroborated. Assertions were also made by the Government in 

its motion for a continuance filed September 15, 1986 wherein it 

also argued the complexity of the case legally and factually, the 

voluminous evidence attendant to a 13-year course of conduct, and 

that it anticipated calling fifty witnesses and introducing 

hundreds of documents. 

The court after evaluating this information from both parties 

found that appellees had in fact shown a particularized need for 

the material. The court acknowledged that while motions like this 

are generally not granted it felt that the facts of this case fell 

within the Dennis ruling. The factors the Supreme Court in Dennis 

had also found persuasive in supporting disclosure were the 

passage of time between when the events alleged occurred and when 

the testimony was to be given, and when the trial commenced; that 

much of the requested testimony which was critical to the 

Government's case consisted of testimony of key Government 

witnesses and accomplices and their testimony was largely 

uncorroborated. The Supreme Court there recognized and stated: 

"A conspiracy case carries with it the inevitable risk of wrongful 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 6 
attribution of responsibility to one or more of the multiple 

defendants." 384 U.S. at 873. In Dennis it appeared to be unfair 

to allow the Government to have access to the material while 

denying access to the defendant; that disclosure rather than 

suppression would promote the proper administration of justice; 

and because the grand jury investigation was completed the need 

for preserving the secrecy of the minutes had diminished. 

The court in the case before us noted: 

"Here it has been a long long time since the 

events alleged in the indictment occurred. In 

this case the Defendants have brought civil 

actions attempting to speed the--either speed 

up the return of the indictment or to stop the 

ongoing investigation. The memories of 

witnesses may have dimmed over the years and 

this--I think the grand jury, at least its 

[sic] alleged here and I suppose it's true 

that many different grand juries have looked 

at this thing." 

Record Vol. II at 13. At the rehearing November 6 the court again 

reiterated that the instant case met the test of Dennis: 

"And I knew when I made that statement of many 

times that in civil proceedings this 

particular Defendant had tried to get the case 

dismissed or the grand jury investigation 

stopped because it dragged out so terribly 

long and the Government--I denied those 

motions, but the Government still waited a 

year or two after all of that to return an 

Indictment." 

Record Vol. III at 11. 

The court here required that the material released to Evans 

be limited to only that which pertained to appellees. The court 

order did not give appellees access to material dealing with any 

other ~nvestigation. Significantly, the Government did not at 

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either the October 16 or November 6 hearing or in its motion to 

reconsider filed October 23 mention that there was an ongoing 

investigation or any particular circumstance which required that 

the grand jury proceedings be kept secret. 

On appeal the Government urges that the Jencks Act, 18 U.S.C. 

§ 3500, prohibited the trial court from ordering the disclosure of 

grand jury material under Rule 6(e) of the Rules of Criminal 

Procedure. This issue was not raised in the trial court and we 

will not consider it here. 

Deference should be shown to the trial court scheduling 

orders because of the ever present scheduling problems. As the 

Sixth Circuit noted in United States v. Van Dyke, 605 F.2d 220, 

227 (6th Cir.): "A Distict Court has wide discretion in the 

scheduling of a trial which should not be disturbed in the absence 

of manifest abuse .. " In the case before us the court in 

ordering the Government to turn over transcribed material within 

seven days of the October 16 hearing and the remaining material at 

least ten days before the start of trial did so because it was 

also concerned with the need to schedule and with the Speedy Trial 

. Act. The court of this said: 

" .•. In other words we must set a trial 

within 40 days of today absent some of those 

findings or the clock will have run down and 

we'll have to dismiss the case. 

"In other words, we must commence this case by 

the 25th of November, according to the 

computations that I have." 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 8 
Record Vol. II at 5. The court considered the order as a "matter 

of timing." Record Vol. III at 3. Obviously this was a matter 

for the court and not the United States Attorney. Considering 

that the Government intended to call at least fifty witnesses, and 

considering the length of time the Government had been working 

with the material, by allowing appellees the amount of time it did 

to review the transcripts, was not excessive. The court explained 

why it felt the material should be disclosed this far in advance 

of trial: "If you hand it to them in the trial, you know as well 

as I do that we are going to have to recess the trial a week." 

Record Vol. II at 22. It is clear from the record that the court 

did not abuse its discretion in setting the time table for the 

production of the grand jury testimony. 

Just as the timing of discovery resides within the discretion 

of the court so does selecting the appropriate sanctions for the 

failure to comply with a discovery ruling. United States v. 

Carrigan, 804 F.2d 599 (10th Cir.). In Carrigan we relied for the 

authority of the district court to impose the sanctions on "its 

inherent power to control and supervise its own proceedings." 804 

F.2d at 603. See also United States v. Levine, 700 F.2d 1176 (8th 

Cir.). In the instant case the Government expressly refused to 

comply with the order because it was concerned with having a 

"vehicle to appeal.'' Record Vol. III at 20. Upon the court's 

denial of the Government's motion to reconsider the order to 

disclose the grand jury record the Government responded: 

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"Now, I don't do this lightly, Your Honor, but 

I'm going to resist that order. What I'm 

going to do is I'll notify you that the 

Government is not going to comply with that 

order and I'm going to ask you to impose 

sanctions--" 

Record Vol. III at 18. The Government sought to dictate to the 

court the sanctions the court should impose. It suggested 

sanctions which sought to keep the information which it selected 

to itself before trial. The trial court characterized the 

suggested sanctions as an "exercise in futility" and we agree. 

While the court does have discretion in selecting what 

sanctions are appropriate for a refusal to comply with a 

scheduling order this discretion is not without limit. While the 

Government's conduct in seeking to control the time schedule and 

to itself control the release of material cannot be condoned and 

despite the Government's request for sanctions the dismissal of 

the indictment was too drastic~ When considering whether a 

dismissal in these circumstances is appropriate the factors stated 

in United States v. Fields, 592 F.2d 638, 647 (2d Cir.), should be 

applied. These are: 

·"The extreme sanction of dismissal of an 

indictment is justified in order to achieve 

one or both of two objectives: first, to 

eliminate prejudice to a defendant in a 

criminal prosecution; second, to 'help to 

translate the assurances of the United States 

Attorneys into consistent performances by 

their assistants.'" (Footnotes omitted.) 

The footnotes in the above quotation refer to United States v. 

Jacobs, 531 F.2d 87 (2d Cir.), and United States v. Estepa, 471 

F.2d 1132 (2d Cir.). See also United States v. Jacobs, 547 F.2d 

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Appellate Case: 87-1331 Document: 010110017427 Date Filed: 02/17/1988 Page: 10 
772 (2d Cir.). These conditions or requirements in Fields are 

reasonable, in our view, for application to the particular 

circumstances before us. When this is done in the case before us 

we must hold the sanction of dismissal of the indictment is too 

extreme. On remand the trial court should consider other 

sanctions it deems appropriate in the event the prosecution does 

not carry out the orders of the court. 

The Government also contends that the court erred in 

dismissing Count One of the indictment on grounds that the statute 

of limitations had run. This count, as mentioned, charged 

appellees with bid rigging in violation of Section One of the 

Sherman Anti-Trust Act. The indictment charged Evans and unnamed 

coconspirators with agreeing to submit noncompetitive or rigged 

bids for the Noble County highway construction project. South 

Prairie Construction Company was awarded the contract. 18 u.s.c. 

§ 3282 provides a five-year statute of limitations for criminal 

conspiracies to violate the Sherman Act. Appellees maintain that 

the statute began to run when the bids were let September 21, 

1979. The indictment was returned April 21, 1986. The Government 

claims the statute did not run while payments were made to South 

Prairie on the contract by the state. South Prairie received 

payments until 1981. There appears to have been no division of 

these payments among the conspirators. The trial court found the 

count barred by the statute of limitations. The court in making 

its decision relied on the trial court's decision in United States 

v. Northern Improvement Company, 632 F. Supp. 1576 (D.N.D.). In 

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that case several contractors were charged with a conspiracy to 

submit rigged bids. As in the instant case, the coconspirators 

agreed which company would be the successful bidder. Moreover, 

the contractors did not share any money once the contract was 

awarded. The trial court concluded that the last act triggering 

the running of the five-year statute of limitations was the 

submission of the rigged bids. The Eighth Circuit, however, 

reversed the trial court in United States v. Northern Improvement 

Company, 814 F.2d 540 (8th Cir.), finding that the statute did not 

begin to run until after the successful contractor accepted the 

last payment on the contract. It concluded that the Sherman Act 

violation was ''accomplished both by the submission of noncompetitive bids and by the request for and receipt of payments at 

anti-competitive levels." 814 F. 2d at 543 n. 2. (Emphasis in 

original.} Although appellees here did not receive any money 

South Prairie did and that was sufficient to delay the start of 

the statute. 

The district court's dismissal of Count One must be and is 

reversed and the imposition of the sanction of dismissal of the 

entire indictment must also be reversed. 

REVERSED and REMANDED. 

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