McBryde, In re

• Decision Date: 02 July 1997
• Docket Number: No. 95-11082,95-11082
• Citation: 117 F.3d 208
• Parties: In re John H. McBRYDE, U.S. District Judge, Petitioner.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 208

117 F.3d 208

In re John H. McBRYDE, U.S. District Judge, Petitioner.

No. 95-11082.

United States Court of Appeals, Fifth Circuit.

July 2, 1997.

William H. Jeffress, Jr., Robert J. McGahan, Scott L. Nelson, Jody Manier Kris, Miller, Cassidy, Larroca & Lewin, Washington, DC, David Broiles, Kirkley, Schmidt & Cotten, L.L.P., Fort Worth, Tx,for Petitioner.

Steve L. Frank, U.S. Department of Justice, Civil Division, Frank W. Hunger, Office of the United States Attorney General, Civil Division, Appellate Staff, Mark Bernard Stern, U.S. Department of Justice, Washington, DC, for Respondents Jerry L. Buchmeyer, Paul Coggins, William O. Kelly and Frank L. Branson.

Robert B. Fiske, Jr., Davis, Polk & Wardwell, New York City, for Respondent Judicial Council of the Fifth Judicial Circuit.

Before HIGGINBOTHAM, EMILIO M. GARZA and DENNIS, Circuit Judges.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

This petition arises out of the reassignment of two cases once pending before Judge McBryde in the Northern District of Texas. The two cases were styled United States v. Michael Eric Satz and Sanjuana Torres, et al. v. Trinity Industries, Inc. Judge McBryde requested the Judicial Council of the Circuit to invalidate these two reassignments. The Council found that "Judge Buchmeyer's factual predicate, on which he based his orders, was correct" and ultimately ordered their reassignment by its own order. Judge McBryde then filed a petition for mandamus with this court. The petition raises difficult questions of jurisdiction and carries us into uncharted waters of superintendence of Article III judges. We begin with a description of the two cases. We then return to the procedural history of the petition for mandamus and the action taken by the Council. Finally, we examine our jurisdiction and then the merits of Judge McBryde's petition.

I

A

Michael Satz was part of an organization that fraudulently offered loan referral services to individuals with poor credit ratings. The scheme made money by charging the individuals a referral fee in advance, with "boilerrooms" operating in several states. ¹

Grand juries in both Phoenix, Arizona, and Fort Worth, Texas, indicted Satz. The Phoenix case was assigned to Judge Paul G. Rosenblatt, and the Fort Worth case by random assignment to Judge McBryde. The Phoenix case reached trial first in late 1994. Satz was convicted and taken into custody, and Judge Rosenblatt eventually scheduled sentencing for May 15, 1995. Shortly thereafter, a Northern District of Texas jury also convicted Satz, and Judge McBryde scheduled sentencing for April 28, 1995.

Investigations into the boilerrooms continued. In early 1995, Phoenix Assistant United States Attorney Darcy Cerow convened a grand jury, which began further investigations into Satz and three of his alleged co-conspirators: Lester Schwartz, Anthony Peter Schwartz, and Robert Schwartz. After extended negotiations, on March 27, 1995, the Schwartzes pled guilty before Judge Rosenblatt to certain crimes arising out of their boilerroom activities. In their plea bargains, the Schwartzes agreed to cooperate with law enforcement authorities in the continuing investigation of the boilerrooms. At the plea proceeding, the following colloquy occurred:

The Court: Anything further for the record?

Ms. Cerow: Your Honor, two things. One, I believe we need a number for the information.

The Clerk: CR 95-79.

The Court: Oh, yes.

The Clerk: They need to move to seal.

The Court: The motion to seal is granted.

The criminal minutes of the docket entries corresponding to each of the Schwartz cases, which apparently have been available to the public throughout the pendency of this affair, reflected the fact that the Schwartzes had pled guilty and stated, "govt's oral m/ seal granted."

AUSA Cerow then contacted Northern District of Texas AUSA Phillip Umphres regarding the Satz case. According to testimony she later gave before Judge McBryde, Cerow told Umphres of Judge Rosenblatt's sealing order and of the ongoing investigation. In particular, Cerow related that the Phoenix investigation had produced documents suggesting that Satz's involvement in certain boilerrooms was more extensive than enforcement authorities in either Arizona or Texas had previously believed. If verified, the information would lead to a longer sentence for Satz. The testimony of AUSAs Cerow and Umphres conflicted regarding the extent to which Cerow informed Umphres of the government's position regarding the scope of Judge Rosenblatt's sealing order.

On April 4, 1995, AUSA Umphres moved to continue Satz's Texas sentencing until June 23. This motion was not under seal. The motion asked Judge McBryde to continue the sentencing then scheduled for April 28 for three reasons. The first was a problem of logistics. Satz was currently held in Arizona and had a sentencing scheduled there in May. The second was that AUSA Cerow was continuing the Arizona investigation into Satz's boilerroom activities and his association with certain co-conspirators, which the motion identified as the Schwartz family. The motion recited that the information thus far generated suggested that Satz may have been a bigger player in the boilerrooms than had previously been believed and that he may have committed perjury at his Texas trial. The motion further stated that AUSA Cerow planned to continue the investigation by asking an Arizona grand jury to subpoena bank records and live witnesses, perhaps leading to the prosecution of other unnamed individuals. The third reason to continue Satz's sentencing was that the Arizona and Texas pre-sentence reports calculated Satz's offense levels in part using some of the same conduct. A good faith argument existed that this double-use constituted double jeopardy. The Fifth Circuit had already held that this double-use did not violate double jeopardy principles. The Ninth Circuit had not yet decided the question. Thus scheduling the Texas sentencing after the Arizona sentencing would finesse any double jeopardy contention Satz might later make. The motion did not mention Judge Rosenblatt's sealing order as a reason to continue sentencing.

Meanwhile, Satz had difficulty getting to Fort Worth for his scheduled sentencing. He filed a motion to be transferred to Fort Worth with the Arizona district court, which Judge Rosenblatt denied on April 17. At the eventual hearings in his court, Judge McBryde stated that upon receiving notice of this order, he called Judge Rosenblatt and got him to agree to transfer Satz to Fort Worth.

On April 18, Judge McBryde denied AUSA Umphres' motion to continue Satz's Texas sentencing. The denial order stated, "[t]he contents of the motion of the United States of America indicates that the government has additional information concerning the activities of defendant MICHAEL ERIC SATZ ('Satz') that could have relevance to the sentencing of Satz." Judge McBryde ordered the United States to deliver a supplementary written report to the Probation Office detailing all such relevant information and requested the Probation Office to write an addendum to the PSR.

On April 21, AUSA Umphres filed under seal a renewed motion to continue sentencing along with five exhibits. Again, the text of the motion itself did not mention a sealing order. Instead it stated that Umphres had delivered some material to the Probation Office, but that this material was cumulative to documents that office already possessed. Further documents remained in Arizona, but AUSA Umphres did not know of their exact contents. These documents suggested Satz's involvement in additional boilerrooms, but the information was as yet uncorroborated, and the Arizona investigation was continuing. According to the motion, "disclosure of the information set out in Exhibit A at this time [would] jeopardize [the] on-going grand jury investigation [in Arizona]." The motion to continue sentencing also asked Judge McBryde to order the Probation Office to keep all information secret from defendant Satz.

A memorandum from Umphres to the Probation Office was attached. It stated that AUSA Cerow had reached plea agreements with certain individuals above Satz in the boilerroom operation, and that these individuals had since been "debriefed." The memorandum explained that Cerow had informed Umphres "that the plea agreements and factual resumes relating to the defendant have been filed under seal as [Cerow] wanted to keep the fact of their cooperation secret [from Satz] for the moment in order to avoid alerting other targets of her investigation, who[m] she did not identify." Finally, the memorandum stated that Postal Inspector Rex Whiteaker once possessed certain information, but that Cerow had asked Whiteaker to send all documents in his possession to Arizona and had told him that all information was covered by the grand jury secrecy rules embodied in Fed.R.Crim.P. 6(e).

Umphres also attached as an exhibit a letter dated April 20 from Cerow to Umphres that again emphasized the continuing grand jury investigation and the Rule 6(e) concerns about disclosing information. This letter, which did not mention a sealing order, included the following paragraph:

If, through an order of the court, we were to invade the secrecy of the grand jury investigation at this time, the investigation would be severely compromised. Although the targets are probably aware of the investigation, they do not know the extent of the grand jury's knowledge of their activities. If the investigation were to become a matter of public record, the targets would be in a position to destroy documents, move assets to avoid forfeiture, and flee the country to avoid prosecution. These acts would essentially bring the grand jury investigation to a halt which would result in the non-prosecution of key players.

Later in the day on April 21, Judge McBryde ruled upon AUSA Umphres' latest motion. The order stated, "The material provided in the [g...