Court Opinion

ID: 9477778
Source: CourtListenerOpinion
Date Created: 2023-08-05 06:30:48.734199+00
Date Added: 2024-06-11T17:46:02.360563
License: Public Domain

KRAVITCH, Circuit Judge
dissenting:
Respectfully, I dissent. The majority holds that Harvey is free from prosecution for crimes he allegedly committed after an unwritten agreement not to prosecute him was reached in September of 1980. The majority’s rationale is that because the government neglected to reduce the agreement to writing, thus creating confusion as to its exact parameters, it had an obligation, as part of due process, to warn Harvey that the agreement did not protect him from prosecution for future crimes.1 Conceding that the government lacks the power to grant a defendant immunity from prosecution for future crimes,2 the majority nevertheless holds, in effect, that this limitation is not operative until the government warns a defendant that it does not possess such authority. The notion that due process requires the government to warn a defendant of the obvious — that an agreement not to prosecute or a grant of immunity does not give the defendant carte blanche to continue committing related crimes with impunity — is untenable. I can*1556not endorse such an unprecedented3 extension of due process.
Despite my disagreement with the majority’s holding in this case, I share its consternation with the government’s failure to reduce to writing the 1980 agreement, and I agree that the government must suffer certain consequences as a result of its oversight. Thus, I concede that although the government may have intended to grant Harvey immunity from prosecution only in the Mobile drug case,4 the magistrate was not clearly erroneous in finding that the agreement granted transactional and use immunity for any and all information or transactions that Harvey had revealed to the DEA agents in 1980, including information about his illegal drug and financial transactions in Florida and the Cayman Islands. Based on this factual finding, I agree that Harvey is immune from prosecution for any related drug or financial crimes committed before September of 1980, and that the first two counts of the indictment were properly dismissed.5 However, despite the magistrate’s finding that the agreement conferred both transactional and use immunity on Harvey, the dismissal of the remaining counts of the indictment, which charged Harvey with crimes allegedly committed after 1980, was improper.
Transactional immunity “accords full immunity from prosecution for the offense to which the compelled testimony relates.” Kastigar v. United States, 406 U.S. 441, 453, 92 S.Ct. 1653, 1661, 32 L.Ed.2d 212 (1972). Although federal law no longer provides for formal, statutory grants of transactional immunity,6 a prosecutor may, as in this case, informally grant transactional immunity to a witness in return for his cooperation in a criminal case. See 1 W. LaFave & J. Israel, Criminal Procedure, § 8.11(d) (1984). Use immunity prohibits the use of compelled testimony, or any evidence derived directly or indirectly from that testimony, against the witness in a criminal prosecution. See 18 U.S.C. § 6002. In contrast to transactional immunity, use immunity does not prohibit the government from prosecuting the witness for crimes about which he testified, provided the government proves that it has other evidence to support the prosecution that “is derived from a legitimate source wholly independent of the compelled testimony.” Kastigar, 406 U.S. at 460, 92 S.Ct. at 1665. Pursuant to 18 U.S.C. §§ 6002, 6003, a district court may formally grant use immunity to a witness who refuses to testify on the basis of his fifth amendment privilege, or, as here, a prosecutor may informally grant use immunity to a witness in return for his cooperation in a criminal case. See 1 W. LaFave & J. Israel, supra, § 8.11(d). *1557The purpose of a grant of either transactional or use immunity is to preclude a witness’ reliance on his fifth amendment privilege against compelled self-incrimination. See Kastigar v. United States, 406 U.S. 441, 449, 92 S.Ct. 1653, 1659, 32 L.Ed. 2d 212 (1972); Counselman v. Hitchcock, 142 U.S. 547, 564, 586-87, 12 S.Ct. 195, 198, 206, 35 L.Ed. 1110 (1892); 1 W. LaFave & J. Israel, supra, § 8.11(a), at 684. As such, in deciding the scope or constitutionality of immunity grants, the Supreme Court traditionally has referred to the scope of the fifth amendment privilege itself. For example, in Heike v. United States, 227 U.S. 131, 33 S.Ct. 226, 57 L.Ed. 450 (1913) (Holmes, J.), the Court refused to construe broadly a transactional immunity statute,7 seeing “no reason for supposing that the act offered a gratuity to crime.” Id. at 142, 33 S.Ct. at 228. Instead, according to the Court, a grant of immunity “should be construed, so far as its words fairly allow the construction, as coterminous with what otherwise would have been the privilege of the person concerned.” Id., 33 S.Ct. at 228.8 See also Shapiro v. United States, 335 U.S. 1, 19, 68 S.Ct. 1375, 1385, 92 L.Ed. 1787 (1948) (following rule of construction of Heike). More recently, in Kastigar, the Court upheld the constitutionality of 18 U.S.C. § 6002 on the ground that use immunity “is coextensive with the scope of the privilege against self-incrimination, and therefore is sufficient to compel testimony over a claim of the privilege.” 406 U.S. at 453, 92 S.Ct. at 1661. Thus, in order to determine the scope of both immunity grants in this case, we must look to the scope of the fifth amendment privilege.9
In general, the privilege against self-incrimination only prohibits compelled testimony that might incriminate a witness for crimes he had already committed, or was in the process of committing, at the time the testimony was given. See Counselman, 142 U.S. at 562, 12 S.Ct. at 198 (purpose of privilege is “to insure that a person should not be compelled, when acting as a witness in any investigation, to give testimony which might tend to show that he himself had committed a crime”) (emphasis added); United States v. Quatermain, 613 F.2d 38, 42 (3d Cir.), cert. denied, 446 U.S. 954, 100 S.Ct. 2923, 64 L.Ed.2d 812 (1980); Rule v. United States, 362 F.2d 215, 217 (5th Cir.1966), cert. denied, 385 U.S. 1018, 87 S.Ct. 744, 17 L.Ed.2d 554 (1967); United States v. Phipps, 600 F.Supp. 830, 831 (D.Md.1985).
In Marchetti v. United States, 390 U.S. 39, 88 S.Ct. 697, 19 L.Ed.2d 889 (1968), however, the Supreme Court held that the fifth amendment privilege was not entirely inapplicable to prospective acts. The petitioner in Marchetti was convicted of violating provisions of a statute that required professional gamblers to register annually with the Internal Revenue Service and pay an occupational tax. The Court held that the petitioner’s assertion of his fifth amendment privilege in refusing to comply with the statute provided a complete defense to his prosecution for failing to register and pay the occupational tax. In so holding, the Court explicitly rejected the notion that the fifth amendment privilege offers protection only as to past and *1558present acts, id. at 53, 88 S.Ct. at 705,10 and emphasized that “[t]he central standard for the privilege’s application has been whether the claimant is confronted by substantial and ‘real,’ and not merely trifling or imaginary, hazards of incrimination,” id., 88 S.Ct. at 705. Relying on this standard, the Court held that the hazards of incrimination created by the registration and occupational tax provisions as to future acts were not “trifling or imaginary” because prospective registrants could reasonably expect that compliance with these provisions “may serve as decisive evidence that they have in fact subsequently violated state gambling prohibitions.” Id., 88 S.Ct. at 706. Although application of this standard proved favorable to the petitioner in Marchetti, the Court stressed that this would not usually be the case, as prospective acts “will doubtless ordinarily involve only speculative and insubstantial risks of incrimination.” Id. at 54, 88 S.Ct. at 705. Thus, Marchetti created a very narrow exception to the general rule that the fifth amendment privilege applies only to past and present acts.
In United States v. Freed, 401 U.S. 601, 91 S.Ct. 1112, 28 L.Ed.2d 356 (1971), the Court emphasized the narrowness of the fifth amendment privilege’s application to future conduct. In Freed, the Court rejected the argument that a registration requirement of the National Firearms Act violated the fifth amendment because the information disclosed could be used in connection with offenses that the transferee of the firearm might commit in the future. In so doing, the Court stated:
Appellees’ argument assumes the existence of a periphery of the Self-Incrimination Clause which protects a person against incrimination not only against past or present transgressions but which supplies insulation for a career of crime about to be launched. We cannot give the Self-Incrimination Clause such an expansive interpretation.
Id. at 606-07, 91 S.Ct. at 1117.
Lower court opinions also make clear that the fifth amendment privilege rarely will apply to future conduct. For example, in United States v. Quatermain, 613 F.2d 38, 42-43 (3d Cir.), cert. denied, 446 U.S. 954, 100 S.Ct. 2923, 64 L.Ed.2d 812 (1980), the court noted that Marchetti did not support the defendant’s argument that the fifth amendment privilege applies to a witness who refuses to testify because he asserts that his testimony somehow may be used to incriminate him in a prosecution for a different type of criminal act that he may commit in the future. Accordingly, the court held that the defendant’s testimony under an informal grant of use immunity about his involvement in a drug ring did not prevent the government from indicting him for subsequently manufacturing a gun silencer, even though the district court found that the defendant’s immunized testimony had helped lead to the indictment on the gun charge. See also United States v. Phipps, 600 F.Supp. 830, 832 (D.Md.1985) (testimony under use immunity grant about involvement in drug conspiracy does not prohibit indictment for subsequently threatening witness who planned to testify against members of conspiracy).
The present case also is distinguishable from Marchetti and does not fit within the narrow exception where the privilege against self-incrimination permits a witness to refuse to testify because of the possibility that such testimony will incriminate him concerning future criminal conduct. The statute in Marchetti required the petition*1559er, a professional gambler, to either admit that he had broken gambling laws and intended to continue doing so, or risk prosecution for tax avoidance. As pointed out earlier, the Marchetti Court intimated that revealing the required information would practically amount to an admission of guilt in a prosecution for a future violation of the gambling laws. See 390 U.S. at 54, 88 S.Ct. at 706. Given this, it is not surprising that the Court concluded that the hazards of incrimination created by the statute, even as to future acts, were “substantial and real,” and “not merely trifling or imaginary.” Id. at 53, 88 S.Ct. at 705.
In contrast, the information that Harvey revealed to the DEA agents in September of 1980 could not have created substantial and real hazards that it would incriminate him for tax crimes he allegedly subsequently committed in April of 1981, 1982 and 1983.11 According to his testimony at the pre-Kastigar hearing, Harvey had revealed to the DEA agents that he had deposited millions of dollars, earned through illegal drag transactions, into his accounts at the Nova Scotia Bank in the Cayman Islands. He also told the agents how he set up corporations in the Cayman Islands to launder drag money. In September of 1980, the defendant could not have had “substantial and real” fears that this information would incriminate him for evasion of taxes on interest income that either was not yet required to be reported12 or had not yet been earned, or for filing a false income tax return that was not due for months to come.
Having concluded that Harvey could not have invoked his fifth amendment privilege in 1980 on the ground that the information he was asked to reveal might incriminate him for future tax offenses, it follows, based on Heike and Kastigar, that neither the grant of transactional immunity nor the grant of use immunity prevents the government from pursuing Harvey’s prosecution on counts three through six of the indictment. In affirming the district court, the majority erroneously “assumes the existence of a periphery of the Self-Incrimination Clause which ... supplies insulation for a career of crime about to be launched.” United States v. Freed, 401 U.S. 601, 606-07, 91 S.Ct. 1112, 1117, 28 L.Ed.2d 356 (1971). I would reverse the district court as to counts three through six. Accordingly, I dissent.13

. More precisely, according to the majority "the government had an obligation, when Harvey disclosed the existence and location of the Cayman Island interest-bearing accounts, to point out that his immunity did not extend to future interest payments derived from those accounts. ...”

. The majority states that "[i]t is clear that even if the government actually did grant Harvey transactional immunity intended to insulate him forever from any prosecution related to the interest earned from the Cayman Islands funds, that component of the 1980 immunity grant would be unenforceable. We do not maintain that appellee, or any defendant, may under any circumstance enjoy perpetual immunity from prosecution for failure to report and/or pay taxes on future interest income realized from bank accounts or other income producing instruments whose existence and location are disclosed in the course of fulfilling his commitments under an informal plea agreement/grant of immunity.” (citations omitted).

. None of the cases cited in the majority opinion support the proposition that due process requires the government to warn a defendant that immunity does not extend to crimes the defendant may commit in the future. At best, the majority convinces me that due process requires the government to adhere to the terms of any plea bargains it makes. See Santobello v. New York, 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427 (1971); Rowe v. Griffin, 676 F.2d 524 (11th Cir.1982). However, I fail to see how this proposition even remotely supports the majority’s holding that the government must warn a defendant that immunity does not extend to future crimes.

. The DEA agents testified to this effect at the "pre-Kastigar" hearing.

. The district court was correct in dismissing counts one and two of the indictment, which charged Harvey with income tax evasion for 1978 and 1979, as the grant of transactional immunity undoubtedly accorded Harvey full immunity from prosecution for any past transactions to which his compelled testimony related. When Harvey spoke to the DEA agents in 1980 he had allegedly already committed the offenses charged in counts one and two of the indictment. Furthermore, Harvey's disclosures of the existence of his foreign bank accounts and his past involvement in money laundering schemes were related to the tax offenses charged in the first two counts of the indictment.

.Transactional immunity statutes typically provided that "no person shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction, matter or thing, concerning which he may testify, or produce evidence, documentary or otherwise ..." Kastigar v. United States, 406 U.S. 441, 451, 92 S.Ct. 1653, 1660, 32 L.Ed.2d 212 (1972) (quoting from Compulsory Testimony Act of 1893, which served as a model for numerous federal immunity statutes).

. The statute provided that "no person shall be prosecuted or be subjected to any penalty or forfeiture for or on account of any transaction, matter, or thing concerning which he may testify or produce evidence, documentary or otherwise, in any proceeding, suit, or prosecution under [the interstate commerce and anti-trust acts].” Heike, 227 U.S. at 141, 33 S.Ct. at 227.

. In Kastigar v. United States, 406 U.S. at 453, 92 S.Ct. at 1661, 32 L.Ed.2d 212, the Court noted that transactional immunity, by specifically providing for full immunity from prosecution, is broader than the fifth amendment privilege, which "has never been construed to mean that one who invokes it cannot subsequently be prosecuted.” The Court has never indicated that transactional immunity is in any other respect broader than the fifth amendment privilege.

. Although Heike, Shapiro, and Kastigar all interpreted formal, statutory grants of immunity, the rationale underlying those decisions is also applicable to informal grants of immunity, as both formal and informal grants of immunity serve to supplant a witness’ fifth amendment privilege against self-incrimination. See United States v. Quatermain, 613 F.2d 38, 41 (3d Cir.) (scope of informal grant of use immunity determined in reference to fifth amendment privilege), cert. denied, 446 U.S. 954, 100 S.Ct. 2923, 64 L.Ed.2d 812 (1980).

. Marchetti overruled United States v. Kahriger, 345 U.S. 22, 73 S.Ct. 510, 64 L.Ed.2d 754 (1953), which held that the same provisions of the tax statute at issue in Marchetti did not violate the privilege against compelled self-incrimination because "that privilege has relation only to past and present acts, not to future acts that may or may not be committed." 345 U.S. at 32, 73 S.Ct. at 515.
Marchetti also overruled Lewis v. United States, 348 U.S. 419, 75 S.Ct. 415, 97 L.Ed. 475 (1955), which held that the wagering tax provisions did not violate the fifth amendment privilege because they were not compulsory. According to the Lewis Court, "[t]he only compulsion under the Act is that requiring the decision which would-be gamblers must make at the threshold. They may have to give up gambling, but there is no constitutional right to gamble. If they elect to wager, though it be unlawful, they must pay the tax.” 348 U.S. at 422-23, 75 S.Ct. at 418.

. Counts three through five of the indictment charged Harvey with evasion of income taxes for the years 1980, 1981, and 1982, offenses that could not have occurred until April of 1981, 1982, and 1983, when Harvey filed his tax returns for the preceding years. See Sansone v. United States, 380 U.S. 343, 351, 85 S.Ct. 1004, 1010, 13 L.Ed.2d 882 (1965) (violation of 26 U.S.C. § 7201 does not occur until the defendant commits an affirmative act constituting an evasion or attempted evasion of the tax). Furthermore, the crime of willfully filing a false tax return for income earned in 1980, as charged in count six of the indictment, could not have occurred until April of 1981 when Harvey filed the allegedly fraudulent return. See United States v. Bishop, 412 U.S. 346, 357-58, 93 S.Ct. 2008, 2016, 36 L.Ed.2d 941 (1973). Thus, although the crimes charged in Counts three and six of the indictment related to Harvey's 1980 taxes, the immunity granted in 1980 did not apply to these crimes, as they did not occur until April of 1981, well after immunity was granted.

. The interest Harvey earned in 1980 was not required to be reported until April of 1981. See supra note 11.

.The majority asserts that because of "the most unusual circumstances of this case,” specifically the government’s failure to keep a record of its agreement with Harvey and the resulting confusion as to its exact parameters, it is “obliged to conclude that the traditional law pertaining to transactional and use immunity is inapposite and does not control the disposition of the government’s appeal.” The majority, however, does not explain why this case is any different from the legion of cases in which facts are unknown or unclear, and a factfinder is relied upon to sort out a confusing situation. Here, the magistrate found, as a matter of fact, that Harvey had been granted use and transactional immunity in 1980. I do not read the majority as holding that this finding is clearly erroneous. Therefore, I do not understand why the majority concludes that "the traditional law pertaining to transactional and use immunity is inapposite and does not control” this case.
I also perceive a weakness in one of the factual assumptions underlying the majority opinion. The majority repeatedly states that Harvey may have been misled into believing that he was immune from prosecution for future crimes and therefore, as a matter of fairness, all doubts as *1560to the scope of the agreement should be resolved in favor of Harvey. The record in this case, however, indicates that Harvey never believed that he was immune from prosecution for future crimes. For example, at the pre-Kastigar hearing, Harvey testified that during the September, 1980 meeting with the DEA agents his attorney reminded the agents of the scope of Harvey’s immunity by stating that Harvey had complete immunity and there was nothing the government could "ever do about what he has done in the past.” Furthermore, Harvey testified on cross-examination that he believed he had complete immunity for crimes he had committed from 1975 until 1980, but that the agreement did not “cover anything” past 1980.
Other events also suggest that Harvey never believed that the agreement extended to crimes committed after the agreement was reached. In 1983, Harvey was subpoenaed to testify at the trial of Scott Combs, who had been indicted for various drug offenses. At this point, the IRS was investigating Harvey for the tax offenses charged in this case. Harvey's attorney somehow found out about the investigation and made a written request for immunity in exchange for Harvey’s testimony at Combs’s trial. The letter requesting immunity states that Harvey had "certain real concerns about his possible exposure to criminal prosecution by [the IRS] if he voluntarily testifies at [the Combs] trial." Immunity was not granted and when Harvey was called to testify at Combs’s trial, he asserted his fifth amendment privilege in response to any questions that could in any way be related to the tax case. Had Harvey believed that he was immune from prosecution for the tax crimes as a result of the 1980 agreement, he hardly would have perceived a need to ask for immunity and assert his fifth amendment privilege in the 1983 trial.
Regardless of what Harvey actually believed the scope of the 1980 agreement to be, I would still reverse the district court as to counts three through six of the indictment, because a defendant’s belief that an immunity grant extends to future crimes would be unreasonable. I have included this discussion only because I believe that the majority’s attempt to portray Harvey as some sort of dupe mischaracterizes the record and considerably weakens its "fundamental fairness” argument.