Case o' The Week: Of Non-Disclose and Oreos - Liew, Brady, and FBI 302 Rough Notes

  Remarkably, exculpatory statements were somehow omitted in an FBI 302 (and the agent’s rough notes were never disclosed).

  Happily, the government now gets a second bite at the Brady apple.

United States v. Liew, 2017 WL 1753269 (9th Cir. May 5, 2017), decision available here.

Players: Decision by Judge Owens, joined by Judges Schroeder and Wardlaw. Nice Brady win for ND Cal stalwart Dennis Riordan in this NorCal case.

Facts: DuPont perfected a lucrative and (it claimed) secret process to create a type of pigment used in everything from paint to the filling of Oreo cookies. Id. at *2.

 China wanted this tech.

  Walter Liew worked with Chinese representatives to start a pigment plant there. Id. at *3. Liew hired a former DuPoint employee, “Spitler,” as a consultant. Id. at *3.

  Liew and Spitler spoke, and in a note documenting their conversation they worried the plant might fail, “even with the best technology and stolen prints.” Id. at *4. Liew, however, later claimed Spitler told him that, as far as DuPont was concerned, “[a]fter 5 years, you are a free man.” Id.

  DuPoint disagreed.

  After learning of the planned Chinese pigment plant, DuPoint sued Liew in federal court. Id. In his civil answer, Liew stated he and his company never “’wrongfully obtained or possess[ed] any’ DuPoint trade secrets.” Id. at *5.

  Liew was later indicted, and charged with obstruction (for his answer in the civil suit), and with economic espionage charges. Id. at *5. Spitler struck an apparent cooperation deal with the government, then committed suicide. Id. at *6.

  Before trial, the government produced a FBI 302 of Spitler’s meetings with the prosecution team. [Ed. note: not in the opinion, but reported in district court briefing, is the fact that Spitler met with FBI Special Agent Kevin Phelan, and others on the prosecution team, six times.] The government did not produce the Special Agent’s rough notes of the Spitler interviews. Id.

  Liew was convicted at trial.

  The defense then produced a declaration from Spitler’s attorney. Id. at *7. Spitler’s attorney reported Spitler’s exculpatory statements omitted from the FBI 302, including his denial that he was involved in a criminal conspiracy. Spitler had also revealed to the government that, after his retirement, DuPont had shipped him a box of documents that Spitler sold to Liew. Because DuPont had voluntarily relinquished those documents, Spitler explained in interviews with the government that he considered them valueless. Id. at *7.

  The defense moved for disclosure of the rough notes of the Spitler interviews. That motion was summarily denied. Id.

Issue(s): “Liew argues that the district court erred by not requiring the prosecution to disclose the rough notes of the FBI’s interviews with deceased co-conspirator Tim Spitler.” Id. at *15.

Held: “While mere speculation about materials in the government’s files does not require a court to make the materials available for defense inspection . . . Liew had more than mere speculation -- he had the declaration of Spitler’s attorney . . . . In light of this declaration, defendants carried their initial burden of producing some evidence to support an inference that the government possessed or knew about material favorable to the defense and failed to disclose it. . . . 

  Although the errors and inconsistencies in the declaration provided by [Spitler’s attorney] cast some doubt on the declaration’s reliability, defendants’ burden was a low one, and the declaration sufficed to support an inference that the rough notes contained favorable material. Because the prosecution did not disclose the rough notes, it did not meet its burden of demonstrating that it satisfied its duty to disclose all favorable evidence known to it. Furthermore, if the rough notes referenced the statements that [Spitler’s attorney] averred Spitler made during the interviews, that material could be sufficient to undermine confidence in the verdict. . . . . 

  [W]e vacate the district court’s order denying defendants’ request for production of the rough notes and remand to the district court for in camera review of the material to determine whether disclosure of the notes might have affected the outcome of the trial.” Id. at *15 (internal citations and quotations omitted).

Of Note: Does your civil client deny wrongdoing when answering in federal court? Be careful: the ND Cal USAO may later indict them for obstruction of justice.

  Judge Owens, thankfully, comes out the right way on this troubling charging stretch, id. at *14, but Liew’s discussion on civil responses and obstruction of justice should be a required read for civil counsel.

How to Use: Is the standard of review for this claim the deferential “abuse of discretion” standard, or the less demanding de novo standard? 

  In an interesting note, Judge Owens explains that – here, in the context of a new trial motion - it is de novo. See id. at *8 n.6. A welcome footnote worth saving for appellate folks.

                                               

Former AUSA Kathryn Haun

For Further Reading: (Former) AUSA Kathryn Haun is one potential candidate for the next United States Attorney for the Northern District of California. See article here. 

  Ms. Haun just gave a candid and revealing interview, defending Attorney General Sessions’ new policy on mandatory minimums. See KQED link here. 

Image of former AUSA Haun from https://static.wixstatic.com/media/bcd40f_342196e499f143a3954b3687110c5860~mv2.gif_srz_200_200_85_22_0.50_1.20_0.00_gif_srz 

Image of Oreo from https://i.ytimg.com/vi/STwpxAWAbrw/0.jpg

Steven Kalar, Federal Public Defender, N.D. Cal. Website at www.ndcalfpd.org

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