U.S. v. DiBernardo

• Decision Date: 13 November 1985
• Docket Number: No. 83-5295,83-5295
• Citation: 775 F.2d 1470
• Parties: UNITED STATES of America, Plaintiff-Appellant Cross-Appellee, v. Robert DiBERNARDO, Theodore Rothstein, Defendants-Appellees, Cross-Appellants.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1470

775 F.2d 1470

UNITED STATES of America, Plaintiff-Appellant Cross-Appellee, v. Robert DiBERNARDO, Theodore Rothstein, Defendants-Appellees Cross-Appellants.

No. 83-5295.

United States Court of Appeals Eleventh Circuit.

Nov. 13, 1985.

Robert Lehner, Jr., Asst. U.S. Atty., Miami, Fla., William C. Bryson, Washington, D.C., for plaintiff-appellant cross-appellee.

Herald Price Fahringer, New York City, for DiBernardo.

Ralph J. Schwarz, Jr., New York City, for Rothstein.

Appeals from the United States District Court for the Southern District of Florida.

Before TJOFLAT and VANCE, Circuit Judges, and ATKINS ^*, District Judge.

TJOFLAT, Circuit Judge:

This appeal presents the question of whether, in the absence of an abuse of the grand jury process, a district court may exercise its supervisory power to dismiss an indictment where (1) the grand jury may have heard false testimony or (2) the prosecutor, in advising the grand jury at the end of its investigation, failed to instruct it to disregard prejudicial evidence irrelevant to the offense eventually alleged in the indictment. The district court dismissed the indictment. We reverse.

I.

In the summer of 1977, the FBI commenced operation "Miporn," an undercover investigation of the obscenity industry. Posing as pornographers, Special Agents Patrick Livingston and Bruce Ellavsky contacted distributors of pornography throughout the United States ordering sexually explicit magazines, films, and videotapes and arranging to have the merchandise shipped to them in Miami, Florida. After a two-year investigation, the Government presented its case to a grand jury sitting in the Southern District of Florida. Special Agents Livingston and Ellavsky testified extensively about their transactions with the distributors. These witnesses and others who testified before the grand jury described the pornography industry as a tight-knit group, one in which the distributors were well acquainted with one another and were highly suspicious of strangers who attempted to do business with them. The distributors rigidly enforced rules against unauthorized duplication of their videotapes, often resorting to threats and violence. Agent Livingston testified that some of the distributors were members of organized crime families and that the pornography industry was controlled by the "Mafia."

On February 12, 1980, the grand jury returned an eighteen-count indictment (the original indictment) against forty-five defendants, including appellees Robert DiBernardo and Theodore Rothstein. Count one charged the defendants with engaging in a nationwide conspiracy to transport obscene materials in interstate commerce in violation of 18 U.S.C. Secs. 371 ¹ and 1465 ² (1982). The remaining seventeen counts of the indictment charged small groups of defendants with substantive violations of section 1465. After this indictment was returned, the Government apparently concluded that insufficient admissible evidence existed to establish the conspiracy offense alleged in count one. The Government, therefore, dismissed the indictment, pursuant to Rule 48(a) of the Federal Rules of Criminal Procedure, ³ and re-presented the case to the grand jury.

On October 15, 1980, the grand jury returned sixteen superseding indictments which effectively divided the single conspiracy alleged in the original indictment into a series of small unrelated conspiracies. In one of these superseding indictments (the instant indictment), the appellees, together with codefendant Andrew D'Apice, were charged with conspiring to use an express company or common carrier to transport obscene materials in interstate commerce, in violation of 18 U.S.C. Secs. 371 and 1462 ⁴ (1982). They were also charged, in six substantive counts, with knowingly using an express company or common carrier to transport obscene materials, in violation of section 1462, and knowingly transporting obscene materials in interstate commerce, in violation of section 1465. The principal factual allegations in the indictment were that D'Apice, as the operator of KED Productions, Inc., sold obscene films and videotapes to the undercover agents and that the appellees, as the true owners of KED, approved all sales of obscene materials and supervised the activities of D'Apice.

After a severance was granted to codefendant D'Apice, the case proceeded to a jury trial against the appellees. They were convicted on all counts, and, after sentencing, they appealed.

On February 12, 1982, during the pendency of their appeals, the prosecutor wrote a letter to all counsel in the Miporn cases to inform them of an unfortunate development in the case: Special Agent Livingston, one of the two undercover agents in the Miporn investigation, had been arrested for shoplifting and, at the time of arrest, had identified himself using his Miporn undercover identification documents. The prosecutor also stated that psychiatric examinations indicated that Livingston had difficulty distinguishing between his real identity and his undercover identity. Following receipt of the prosecutor's letter, the appellees moved the district court alternatively to vacate their convictions and dismiss their indictment with prejudice or to grant them a new trial. The defendants in the fifteen companion cases filed similar motions. ⁵

The court consolidated these motions for disposition and convened an evidentiary hearing which focused primarily on Agent Livingston's psychiatric problems. Following the hearing and a review of the testimony heard by the grand jury that returned the original and superseding indictments, the district court, in a memorandum opinion, 552 F.Supp. 1315 (S.D.Fla.1982), found that the superseding indictments were significantly "tainted" by two factors: (1) the "subsequent behavior and perjurious propensities" of Special Agent Livingston, ⁶ id. at 1324, and (2) the failure of the prosecutor to instruct the grand jury returning the superseding indictments to "disregard the evidence related to organized crime connections and violent activities of other individuals, and additional irrelevant evidence unrelated to the separate defendants involved in the individual conspiracies." Id. at 1325. Based on these findings, the district court, in an exercise of its supervisory power over the administration of criminal justice in the Southern District of Florida, dismissed without prejudice the superseding indictments in the twelve Miporn cases that had not proceeded to trial. The court took no action in the cases that had been tried. The Government immediately moved the court to reconsider its dismissal of the twelve indictments. The court denied the motion in a second memorandum opinion, 561 F.Supp. 783 (S.D.Fla.1983). In that opinion, the court addressed the instant case, which was still on appeal, instructing the Government to show cause why its indictment should not be dismissed. After the Government responded, the district court requested this court to remand the case so that the indictment could be dismissed. We honored the district court's request, and, on June 27, 1983, the district court, following the rationale of its two memorandum opinions, vacated appellees' convictions and dismissed their indictment without prejudice. ⁷ The Government now appeals from this disposition. ⁸

II.

The single issue presented by this appeal is whether the dismissal of the indictment against the appellees was a proper exercise of the district court's supervisory power. The district court based its dismissal upon the combined effect of two unrelated factors: (1) the questionable credibility of Special Agent Livingston at the time he testified before the grand jury, and (2) the failure of the prosecutor to instruct the grand jury, when it was considering the superseding indictments, to disregard certain irrelevant prejudicial evidence. We conclude, as did the district court, that neither factor standing alone provided a legally sufficient ground for invoking the district court's supervisory power. Unlike the district court, however, we find that the two factors, being unrelated, could not have had a combined effect which warranted the exercise of such power. This finding follows inexorably from an analysis of the two factors. We turn therefore to a consideration of each factor.

A.

The appellees' superseding indictment was based in part on the testimony of Agent Livingston. Although the district court did not find that Livingston perjured himself before the grand jury or at trial, it did find evidence which tended to "indicate that Agent Livingston's [psychological] problem in all likelihood existed at the time of the presentation of this case to the grand jury." 561 F.Supp. at 786. The possibility therefore existed that Livingston may have testified falsely before the grand jury. We hold that, absent proof of government misconduct, the fact that Agent Livingston may have inadvertently given false testimony to the grand jury did not justify the dismissal of the indictment under the court's supervisory power.

In United States v. Pabian, we recognized that "[a]lthough the federal judiciary exercises a supervisory role over federal grand juries, that role must be informed by a recognition that dismissal of an indictment ... is an 'extreme sanction which should be infrequently utilized.' " 704 F.2d 1533, 1536 (11th Cir.1983) (quoting United States v. Owen, 580 F.2d 365, 367 (9th Cir.1978)). This court has indicated that the possibility that a witness may have given false testimony before the grand jury does not automatically vitiate an indictment based on that testimony; to dismiss an indictment the district court must also find an abuse of the grand jury process such as perjury or government misconduct. See United States v. Hyder, 732 F.2d 841, 845 (11th Cir.1984); United States v. Sullivan, 578 F.2d 121, 124 (5th Cir.1978) ⁹ (refusing to "adopt the proposition that, absent perjury or...