People v. District Court of Arapahoe County

• Decision Date: 24 April 1995
• Docket Number: No. 94SA394,94SA394
• Citation: People v. District Court of Arapahoe County, 894 P.2d 739 (Colo. 1995)
• Parties: The PEOPLE of the State of Colorado, Petitioner, v. The DISTRICT COURT OF ARAPAHOE COUNTY and The Honorable Jack F. Smith, One of The Judges Thereof, Respondents.
• Court: Colorado Supreme Court

Page 739

894 P.2d 739

The PEOPLE of the State of Colorado, Petitioner, v. The DISTRICT COURT OF ARAPAHOE COUNTY and The Honorable Jack F. Smith, One of The Judges Thereof, Respondents.

No. 94SA394.

Supreme Court of Colorado En Banc.

April 24, 1995.

Rehearing Denied May 15, 1995.

Gale A. Norton, Atty. Gen., Stephen K. ErkenBrack, Chief Deputy Atty. Gen., Timothy M. Tymkovich, Sol. Gen., John Daniel Dailey, Deputy Atty. Gen., Terrence A. Gillespie, First Asst. Atty. Gen., Victor Reichman, Asst. Atty. Gen., Sp. Prosecutions Unit, Criminal Enforcement Section, Denver, for petitioner.

Montgomery Little & McGrew, P.C., Christopher B. Little, Englewood, for Charles A. Crouch, appearing on behalf of the respondents.

Justice LOHR delivered the Opinion of the Court.

In this original proceeding under C.A.R. 21, the petitioner, the People of the State of Colorado, requested this court to issue a rule requiring the respondent court ¹ to show cause why an order that it issued in a criminal prosecution suppressing evidence obtained through civil discovery in a related matter should not be reversed as an abuse of discretion. Having issued the rule to show cause, we now make the rule absolute.

I.

The People challenge a suppression order entered by the respondent court in a criminal prosecution against Charles A. Crouch for violations of the Colorado Securities Act, §§ 11-51-101 to -908, 4B C.R.S. (1994 Supp.), and the Colorado Commodity Code, §§ 11-53-101 to -211, 4B C.R.S. (1994 Supp.). We derive the pertinent facts from the briefs and supporting materials filed by the parties in this original proceeding.

On November 25, 1991, Philip A. Feigin, the Securities Commissioner for the State of Colorado (Commissioner), filed a civil action against Five Star Energy Corporation (Five Star), Eagle Energy, Inc. (Eagle Energy), and several persons involved in the operations of the corporate defendants, including Charles A. Crouch. In the complaint, the Commissioner identified Crouch as the "President/CEO" of Five Star and alleged that the defendants had sold Oil Purchase Agreements in Colorado to an undetermined number of people. The Commissioner further alleged that the sales of the Oil Purchase Agreements constituted unlawful commodity transactions and that by such sales the defendants had also violated the Colorado Securities Act by offering and selling unregistered securities to the investing public. The Commissioner sought an injunction against all of the defendants restraining them from additional sales of the Oil Purchase Agreements, as well as other legal and equitable relief under the Colorado Securities Act and the Colorado Commodity Code.

On the date the complaint was filed, the Commissioner also filed a Motion for Leave to Take Expedited Discovery, pursuant to C.R.C.P. 30(a), 30(b)(5), 34(b), and 45. As part of the relief requested, the Commissioner sought an order restraining the defendants from destroying, concealing, and dissipating documents used in connection with the allegedly illegal sales, and requested leave to subpoena documents and to depose the defendants immediately to determine the extent of the documents and other evidence connected with the allegedly illegal activities. The district court granted the motion on November 26, 1991.

On receiving the district court's order granting his motion, the Commissioner immediately issued a subpoena duces tecum to Charles Crouch, ordering him to attend and give testimony at a deposition in the civil action on December 2, 1991. The subpoena also ordered Crouch to produce certain documents in his possession that pertained to the operation of Five Star and Eagle Energy and to bring them to the deposition. Crouch appeared pursuant to the subpoena, gave testimony in a deposition, and produced the corporate documents requested by the Commissioner. Crouch was not represented by counsel at the deposition and he did not invoke the protections of the Fifth Amendment to the United States Constitution before answering the questions in the deposition. ²

On January 23, 1992, the district court entered a default judgment and permanent injunction against Five Star and Crouch, jointly and severally. ³ The district court enjoined Crouch from engaging in the security activities enumerated in the order and entered judgment against him for damages, costs and legal fees totalling $106,230.

On May 28, 1993, the People instituted the present criminal action against Crouch by filing a twenty-one count information in the Arapahoe County District Court. In the information, the People alleged numerous violations of the Colorado Commodity Code and the Colorado Securities Act. Subsequent to the filing of the information, Crouch filed several motions, including a motion to suppress the evidence obtained from him during the previous civil action, in which he had been deposed and had produced documents pursuant to the Commissioner's subpoena. Crouch argued that the evidence obtained in the earlier proceeding could not be used against him in the criminal prosecution because of the provisions of section 11-51-601(4), 4B C.R.S. (1994 Supp.). ⁴ Crouch maintained that all of the evidence obtained in the prior civil action, including his deposition and the documents produced pursuant to the Commissioner's subpoena, should be suppressed.

The respondent court agreed with Crouch and granted his motion to suppress the evidence. The respondent court reasoned that in the prior action, Crouch "was compelled to produce documents pursuant to an order for expedited discovery," that he was subject to a subpoena duces tecum sought by the Attorney General, ⁵ and that he was subsequently deposed. Relying on Nelson v. United States, 208 F.2d 505 (D.C.Cir.1953), and on section 11-51-601(4), the court determined that the state could not use the documentary evidence or deposition testimony obtained from Crouch under compulsion in a subsequent criminal action involving the same activities and that the evidence must therefore be suppressed. The People sought reversal of the suppression order by a petition under C.A.R. 21, and we issued a rule to show cause why that relief should not be granted.

II.

Crouch asserts that review under C.A.R. 21 is not appropriate in this case. We first address that issue.

An original proceeding pursuant to C.A.R. 21 is not a substitute for an appeal and is limited to an inquiry into whether the trial court exceeded its jurisdiction or abused its discretion. Hayes v. District Court, 854 P.2d 1240, 1243 (Colo.1993); Halliburton v. County Court, 672 P.2d 1006, 1009 (Colo.1983). Matters pertaining to pretrial discovery are committed to trial court discretion, and review of discovery orders is normally limited to appeal. Hayes, 854 P.2d at 1243; Harris v. District Court, 843 P.2d 1316, 1318 (Colo.1993).

Crouch argues that the trial court's ruling at issue here is an appealable order or, alternatively, that the People should have filed an interlocutory appeal pursuant to C.A.R. 4.1. We do not agree and find the exercise of original jurisdiction warranted in the circumstances of this case. The trial court's suppression order effectively forecloses further prosecution of the case by the state, for the order suppresses essentially all of the evidence necessary for the state's case. Furthermore, an interlocutory appeal pursuant to C.A.R. 4.1 is not appropriate. C.A.R. 4.1 allows the state to file interlocutory appeals from trial court rulings granting motions to suppress for unconstitutional seizures of property, involuntary confessions or admissions, and improper orders for nontestimonial identifications. See Crim.P. 41(e) and (g), Crim.P. 41.1(i) and C.A.R. 4.1. The trial court based its suppression order on section 11-51-601(4) rather than on grounds supporting interlocutory relief under C.A.R. 4.1. Accordingly, we conclude that the exercise of original jurisdiction pursuant to C.A.R. 21 is appropriate.

III.

We begin our analysis of the propriety of the respondent court's action by first examining the statute in question, section 11-51-601(4), 4B C.R.S. (1994 Supp.). We then address whether established constitutional principles support the respondent court's suppression order.

A.

In construing statutes, this court's primary task is to ascertain and give effect to the intent of the legislature; to do so, the court must first look to the language of the statute itself. People v. Wiedemer, 852 P.2d 424, 428 (Colo.1993); Colorado State Bd. of Medical Examiners v. Saddoris, 825 P.2d 39, 42 (Colo.1992); R.E.N. v. City of Colorado Springs, 823 P.2d 1359, 1364 (Colo.1992). When the language of the statute is clear so that the legislature's intent can be discerned with reasonable certainty, there is no need to resort to other rules of statutory interpretation. Wiedemer, 852 P.2d at 428; Snyder v. Jefferson County School Dist. R-1, 842 P.2d 624, 629 (Colo.1992); R.E.N., 823 P.2d at 1364.

With these precepts in mind, we now examine the pertinent provisions of the Colorado Securities Act, §§ 11-51-101 to -908, 4B C.R.S. (1994 Supp.) (the Act). Sections 11-51-601 to -606 of the Act empower the securities commissioner to investigate violations of the Act and to enforce its provisions. The Act authorizes the securities commissioner to "administer oaths and affirmations, subpoena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, agreements, or other documents or records" deemed relevant to the securities commissioner's inquiry. § 11-51-601(2), 4B C.R.S. (1994 Supp.) (emphasis added). When an individual fails to obey a subpoena, the securities commissioner can apply to the Denver District Court for an order "requiring that person to appear before the securities commissioner ... to produce documentary evidence if so ordered or to give evidence touching the matter under investigation or in question." § 11-51-601(3), 4B...