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United States v. Nobmann

May 20, 2005

UNITED STATES OF AMERICA, PLAINTIFF,
v.
LEE NOBMANN, DEFENDANT.



The opinion of the court was delivered by: Vaughn R Walker United States District Chief Judge

ORDER

By order filed August 27, 2004, the court suppressed the fruits of a search conducted by the government pursuant to a facially invalid warrant. Doc #38 (the "suppression order"). The factual background of the case and the search are amply recited in that order; the court will not repeat it here. The government has elected to proceed to trial, but a dispute has arisen over the practical effect of the court's suppression order. The dispute arises in three postures -- defendant seeks the return of the items seized in the unlawful search; he opposes the government's request for a pretrial subpoena for those same items; and he seeks to exclude the items from evidence at trial. (The second of these was rejected on alternative grounds by order filed October 4, 2004. Doc #46.) All three formulations raise the same question of law and fact: What materials are tainted by the government's unlawful search? This question turns on the "fruit of the poisonous tree" doctrine and the exceptions thereto: The "independent source" exception, the "inevitable discovery" exception and the "attenuated basis" exception. See, e g, United States v Smith, 155 F3d 1051, 1060 (9th Cir 1998).

To determine what of the government's evidence falls within the scope of the suppression order, and to determine which (if any) of the exceptions to the fruit of the poisonous tree doctrine apply, the court held an evidentiary hearing on March 28, 2005 (the "hearing"). The single witness at the hearing was Special Agent Leland Wulff ("Wulff") of the criminal investigation unit of the IRS. Wulff has been the lead agent investigating this case from its earliest stage; he applied for the search warrant found defective in the suppression order, he has issued numerous IRS summonses to third parties in connection with this case and he is familiar with the source of most of the evidentiary materials the government proposes to present at trial.

The government proposes to present about 250 exhibits; defendant challenges the admissibility of most of these. At the court's suggestion, the parties have categorized the exhibits in a way that somewhat simplifies the court's treatment of them. The government categorizes its exhibits as "exhibits obtained from searches," "exhibits not obtained from searches" and "exhibits obtained from searches but also * * * disclosed by [former Golden State Lumber CFO] Jim O'Brien or attached to civil depositions." Defendant addresses quite a few separate clusters of exhibits within the second category. But overall, the categories are helpful and the court will organize its analysis around the government's categories, with due regard for the particularized arguments made by defendant. Accordingly, the court proceeds category-by-category, introducing the relevant law and making factual findings as necessary.

I "Exhibits Obtained from Searches"

The government's argument in advocating the admissibility of exhibits that were obtained from the illegal searches (and nowhere else) is that they would inevitably have been discovered by the issuance of IRS summonses to defendant's company, Golden State Lumber, Inc (GSL). The court simply cannot accept this argument. Most obviously, the availability of the IRS summons procedure in any tax fraud case would render the Fourth Amendment a dead letter, for the government could always assert that materials discovered in an illegal search could have (and would have) been obtained by IRS summons instead.

Moreover, as the Ninth Circuit has pointed out, "'[t]he mere fact that the government serves a subpoena, however, does not mean that it will obtain the documents it requests. A subpoena can be invalid for a variety of reasons * * *.'" Center Art Galleries-Hawaii v United States, 875 F2d 747, 754 (9th Cir 1989) (quoting United States v Roberts, 852 F2d 671 (2d Cir 1988)). And in Roberts, the Second Circuit acknowledged that destruction of evidence by the recipient of the summons was yet another possibility that made discovery by summons anything but inevitable.

Indeed, Wulff candidly acknowledged just such a concern in response to a question put to him by the court:

The Court: As I understand your testimony, you did not think [at the time of the illegal search] that a summons directed to Nobmann and Golden State would be effective in producing the documents that you were after, correct?

Wulff: Yes.

Tr at 169:23-170:2.

Accordingly, the court must reject the government's inevitable discovery theory with respect to documents obtained from the searches. As there is no other viable argument for the admission of the exhibits listed on Schedule I of the government's post-hearing memorandum, those exhibits are EXCLUDED from evidence and the government is ORDERED to return them forthwith to GSL.

II "Exhibits not Obtained from Searches"

Defendant makes a global argument that exhibits not obtained from the searches but nonetheless obtained through the information provided by former GSL CFO Jim O'Brien ("O'Brien") are tainted: "O'Brien was not an 'independent source'; he was inextricably involved as the source of the warrants; the whole case is now centered on whatever evidence he might give." Def Br (Doc #61) at 4:10-11. But O'Brien cannot logically be tainted by the fact that his information was used to procure the invalid warrant used in the illegal search; the taint of an illegal search ...


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