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United States v. Nobmann

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA


July 26, 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 May 20, 2005 (Doc #63), the court addressed a dispute that arose between the parties regarding the practical effect of the court's August 27, 2004, suppression order. Doc #38. In the May 20, 2005, order, the court excluded from evidence "Schedule I" exhibits obtained through searches and reserved decision on certain "Schedule II" and all "Schedule III" exhibits pending further briefing by the parties. Through this supplemental briefing, the parties largely resolved the remaining disputes. Defendant also moved to exclude government Exhibit 216 under FRE 803(6), 902(11), 1002, 1003, 1004, and 1006. The court heard argument on these matters on July 12, 2005. Having reviewed the parties supplemental briefing on the Schedule II and III exhibits, as well as the parties' submissions on defendant's motion to exclude Exhibit 216, the court will address each in turn.

I.

This court's August 27, 2004, order suppressed the fruits of a search conducted by the government pursuant to a facially invalid warrant. Doc #38 (the "suppression order"). The government subsequently indicated its intent to proceed to trial and proposed to present about 250 exhibits. Defendant challenged the admissibility of most of these exhibits. Following an evidentiary hearing on March 28, 2005 (the "hearing"), the court ruled on the admissibility of the government's exhibits in a May 20 2005, order. Doc #63. For purposes of clarity, the court adopted the government's helpful categorization of the documents into three "schedules." Schedule I contains "exhibits obtained from searches"; Schedule II consists of "exhibits not obtained from searches"; and Schedule III consists of "exhibits obtained from searches but also * * * disclosed by [former Golden State Lumber CFO] Jim O'Brien or attached to civil depositions." In the May 20, 2005, order, the court ruled that all Schedule I evidence, as well as some Schedule II evidence, was tainted by the government's unlawful search and should be excluded from trial. Doc #63. The court found many of the remaining Schedule II exhibits admissible under various exceptions to the "fruit of the poisonous tree" doctrine. Id. Finally, the court reserved decision as to Schedule II exhibits 202-204 and all Schedule III exhibits, ordering the government to provide supplemental briefing establishing an independent source for these exhibits. Id.

II.

A. Exhibits 202, 203, 204

The government filed its supplemental memorandum on June 16, 2005 (Doc #65), in which it established the independent source for Schedule II exhibits 202-204. Defendant's reply concedes the independent source and withdraws the request to exclude these exhibits. Doc #68. Accordingly, the court finds that exhibits 202-204 are admissible at trial.

B. Schedule III Exhibits

With regard to the Schedule III exhibits, the government's supplemental memorandum changes course somewhat. Rather than provide an independent source for each of the Schedule III exhibits previously listed (Exhibits 61, 65, 73, 81-100, 115, 117, 123, 138, 174-175, 177, 187, 189, 217-218, 221 and 223b), the government proposes an "Amended Schedule III," which seeks to offer into evidence only a fraction of the previously proposed Schedule III exhibits, namely Exhibits 115, 117, 123*fn1 , 218, 221 and 223b. Doc #65.

Defendant argues that the court should exclude from evidence all Schedule III exhibits omitted from the government's Amended Schedule III "[b]ecause the government has abandoned any submission supporting them * * *." According to the government, these exhibits are being withdrawn because identical copies are contained in Exhibit 216, which this court has not excluded. The government thus objects to the exclusion of these exhibits, inasmuch as they are part of Exhibit 216. Because the government is not seeking to offer Exhibits 61, 65, 73, 81-100, 138, 174, 175, 177, 187, 189 and 217 into evidence, the court need not determine their admissibility. The court addresses the admissibility of Exhibit 216 infra.

On the other hand, defendant concedes that the government has demonstrated that Exhibits 218, 221 and 223b each derive from an independent source and withdraws his Fourth Amendment objections to these exhibits. Doc #68 at 3. Accordingly, the court deems Exhibits 218, 221 and 223b admissible.

The court now turns to the parties' dispute over the admissibility of Schedule III Exhibits 115, 117 and 123. In its May 20, 2005, order, the court directed the government to identify both the independent source for the identity of the exhibit as well as evidence establishing that the exhibits in fact were obtained from third parties. See Doc #63 at 9. The court found the government's Schedule III exhibits suspect, in part, where the government provided "no references at all to facts in evidence that establish that the exhibits were summonsed from the third parties listed on Schedule III." Id. Although the court suggested that an appropriate submission could "take the form of a table," the court reiterated that such a table must identify both the "source for the identity of the exhibit" and "evidence * * * establishing how the exhibit was independently obtained." Id. (emphasis added). With regard to Exhibits 115, 117 and 123, the government's Amended Schedule III table properly identifies the independent source for the identity of the exhibit. Yet the government merely asserts that it summonsed the exhibits from a third party (American Express); once again, no evidence is referenced establishing that the exhibits were in fact summonsed from American Express.

On July 5, 2005, the government addressed this deficiency by filing with this court a copy of a letter to American Express with the government's summons and a copy of a letter received from American Express enclosing the documents. Doc #70. Although the government has not provided a copy of the actual summons, these letters are sufficient to show that the government obtained American Express records from a third party. At the hearing on July 12, 2005, the government represented that Exhibits 115, 117 and 123 consist of documents obtained from American Express and do not contain any documents improperly seized. Based on the government's representation in court, defendant's counsel conceded the admissibility of these exhibits. Accordingly, the court finds Exhibits 115, 117 and 123 admissible.

III. Defendant's Motion to Exclude Exhibit 216

On June 28, 2005, defendant filed a motion to exclude government Exhibit 216, which consists of 640 pages of copies of Golden State Lumber (GSL) business records that O'Brien made and removed from the company after he was fired in September 2001. Exhibit 216 also contains "summaries" of GSL business records created by O'Brien. As noted above, the originals of these copies were unlawfully seized by the government, and the government has withdrawn its request to introduce the originals into evidence. See Govt's Response to Def's Reply at 1:17-18. (withdrawing offer of Exhibits 61, 65, 73, 81-100, 138, 174, 175, 177, 187, 189). To the court's knowledge, the originals are still in the government's possession.

This court previously found that Exhibit 216 is admissible over defendant's Fourth Amendment objection, because even without the illegal search of GSL, the government would have obtained these materials from O'Brien, an independent source. Doc #63 at 5-6. The court now addresses defendant's latest evidentiary challenges to Exhibit 216.

A. The Best Evidence Rule

Defendant first argues that admission of the copies contained in Exhibit 216 would violate the best evidence rule as set out in Article X of the FRE, Rules 1001-1008. The best evidence rule states that "[t]o prove the contents of a writing, * * * the original is required except as otherwise provided in these rules or by law." FRE 1002. Rule 1003, however, allows that a duplicate is admissible "to the same extent as an original unless

(1) a question is raised as to the authenticity of the original or

(2) in circumstances it would be unfair to admit the duplicate in lieu of the original." Defendant does not contest the authenticity of the original documents from which O'Brien produced these copies. Rather, defendant argues that it would be "unfair" to admit the copies because the originals are unavailable due to the government's own misconduct, i e, the illegal search.

Defendant relies in large part on Judge Orrick's opinion in Seiler v Lucasfilm, Ltd, 613 F Supp 1253 (ND Cal 1984), and the United States Court of Appeals for the Ninth Circuit's affirmance of that opinion, 808 F2d 1316 (9th Cir 1986). In Seiler, plaintiff alleged that characters in the 1980 movie The Empire Strikes Back were copied from drawings plaintiff made in 1976 and 1977. 808 F2d at 1317-18. Plaintiff could not produce these original drawings, however, and thus sought to prove his case through the introduction of "reconstructions" he created in 1981, after the movie was released. Id. Applying the best evidence rule, Judge Orrick found that Seiler lost or destroyed the originals in bad faith and denied admissibility of the reconstructions. Id. In affirming this decision, the Ninth Circuit stated:

[I]n proving the terms of a writing, where the terms are material, the original writing must be produced unless it is shown to be unavailable for some reason other than the serious fault of the proponent.

Id at 1319 (quoting McCormick on Evidence § 230 (5th Ed)). Defendant contends that this language applies to the present case; to wit: the government's serious fault (the illegal search and subsequent suppression) rendered the originals unavailable and consequently, the copies should be inadmissible.

Defendant's reliance on Seiler is misplaced. In that case, Seiler sought to prove the contents of the original drawings pursuant to FRE 1004(1), under which "other evidence" is admissible to prove the content of originals when the originals have been lost or destroyed, unless the proponent lost or destroyed them in bad faith. FRE 1004(1). As the Ninth Circuit observed, the evidence that Seiler offered "does not consist of true copies or exact duplicates but of 'reconstructions' * * * which might have no resemblance to the purported original * * *." 808 F2d at 1319 (emphasis added). Under those circumstances, the Ninth Circuit held, "no 'reconstruction' can substitute for the original." Id.

The government did not lose or destroy the originals of the Exhibit 216 documents; hence, FRE 1004(1) does not apply to this case and the question of the government's bad faith is irrelevant to this particular inquiry. Moreover, the government seeks not to introduce 'reconstructions' of the documents in Exhibit 216, but mechanically created reproductions "which accurately reproduce the original." See FRE 1001(4). These "true copies or exact duplicates" obviate the concerns present in Seiler regarding the reliability of evidence offered to prove the contents of a writing. 808 F2d at 1319. Finally, it is not "unfair" to admit these duplicates simply because the originals were properly suppressed. Such an outcome would undermine the "independent source" exception to the fruits of the poisonous tree doctrine. Accordingly, the court finds that the duplicates contained in Exhibit 216 are admissible.

Additionally, the court finds that the "summaries" created by O'Brien are admissible as well. Pursuant to FRE 1006, summaries are admissible when evidence is so voluminous that it "cannot conveniently be examined in court * * *." Rule 1006 governs summaries prepared for use at trial. United States v Draiman, 784 F2d 248, 256 n6 (7th Cir 1986). The burden is on the proponent to establish that the materials upon which the summaries are based are admissible. United States v Johnson, 594 F2d 1253, 1255 (9th Cir 1979). The government has demonstrated that these summaries were prepared by O'Brien based on the duplicates that the court finds admissible. Accordingly, the summaries are also admissible.

B. The Business Record Exception to the Hearsay Rule

Finally, defendant asserts that the documents in Exhibit 216 are hearsay and do not come within the exception of FRE 803(6) for business records. Moreover, defendant asserts that Exhibit 216 cannot be properly authenticated under FRE 902(11). Without explanation, defendant maintains that the duplicates in Exhibit 216 cannot meet the business records exception to the hearsay rule. Rule 803(6) provides that documents "kept in the course of a regularly conducted business activity" are not excluded by the hearsay rule, so long as they are properly authenticated by the testimony of the custodian or other qualified witness or by certification pursuant to FRE 902(11) or 902(12). FRE 803(6). The foundation for qualifying a business record under FRE 803(6) consists of four basic elements: (1) the record was made and kept in the course of a regularly conducted business activity; (2) it was the regular practice of the business activity to make the record; (3) the record was made at or near the time of the event that it records; and (4) the record was made by a person with knowledge who had a business duty to report. FRE Rule 803(6). The government proposes to authenticate these business records through O'Brien's testimony. The court finds that these documents are admissible, provided that O'Brien can properly establish a foundation for qualifying these documents as business records at trial. If O'Brien adequately establishes this foundation, certification under Rule 902(11) is unnecessary.

IV.

In sum, the government no longer seeks to offer the following exhibits into evidence: Exhibits 61, 65, 73, 81-100, 138, 174, 175, 177, 187, 189 and 217. Exhibits 115, 117, 123, 202-204, 218, 221 and 223b are admissible. Finally, both the duplicates and summaries contained in Exhibit 216 are admissible, subject to proper authentication at trial.

IT IS SO ORDERED.


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