U.S. v. Kilroy, 92-3201

• Decision Date: 16 September 1994
• Docket Number: No. 92-3201,92-3201
• Citation: 27 F.3d 679,307 U.S. App. D.C. 229
• Parties: UNITED STATES of America v. William J. KILROY, Appellant.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 679

27 F.3d 679

307 U.S.App.D.C. 229

UNITED STATES of America v. William J. KILROY, Appellant.

No. 92-3201.

United States Court of Appeals District of Columbia Circuit.

Argued Jan. 11, 1994.

Decided July 8, 1994.

Rehearing Denied Sept. 16, 1994.

Appeal from the United States District Court for the District of Columbia 90cr00101-01.

Alan G. Warner, Washington, DC (appointed by the Court) argued the cause and filed the briefs, for appellant.

James C. Bohling, Asst. U.S. Atty., Washington, DC, argued the cause for appellee. With him on the briefs were Eric H. Holder, Jr., U.S. Atty., John R. Fisher, Thomas J. Tourish, Jr., and Harry R. Benner, Asst. U.S. Attys., Washington, DC.

Before SILBERMAN, SENTELLE, and HENDERSON, Circuit Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

Dissenting opinion filed by Circuit Judge SILBERMAN.

SENTELLE, Circuit Judge:

William J. Kilroy appeals from a criminal judgment entered upon his conditional plea of guilty in which he preserved, inter alia, the issue of whether the indictment against him had been obtained in violation of immunity promised him in a plea agreement in a prior case. He raises only that issue on appeal. As we agree with the district court that the government has met its burden of establishing that its prosecution was untainted by improper use of immunized statements, we affirm.

I. THE FACTS

Between 1981 and 1985, an organized crime task force of the Department of Justice investigated Kilroy, an insurance broker, on suspicion that he (and others) had sold fraudulent insurance coverage to a union pension fund in Las Vegas. In June, August and November of 1983, FBI agents and investigators from the Department of Labor interviewed Kilroy, who proved cooperative by disclosing relevant facts and documents. On March 26, 1985, a Las Vegas grand jury that had heard a synopsis of Kilroy's 1983 statements returned an indictment against him and others charging offenses arising out of the sale of fiduciary liability insurance to a culinary union through a sham company.

Kilroy then acquiesced to further interrogation by FBI agents; on August 1 and 2, 1985, Kilroy informed them that he had embezzled pension funds held in trust for the National Council of Senior Citizens (NCSC), a nonprofit corporation located in the District of Columbia. On August 14, Kilroy agreed to plead guilty to one count of the Las Vegas indictment and to testify in related prosecutions; in return, the government, among other things, purported to grant him "retroactive use immunity" for his prior statements to the FBI, including his confession of the NCSC embezzlement and his disclosures in 1983.

In late March 1985, a short article in the interior pages of the Baltimore Sun reported that Kilroy had been indicted and described the charges. Several weeks later--before Kilroy confessed his embezzlement at NCSC--James Kim, NCSC's controller, asked accountant Robert Williams to audit NCSC's pension plan. On June 7, Williams reported to NCSC that he had reason to believe Kilroy had embezzled from the pension fund; by late September Williams had determined that the missing amount was $573,000 and advised NCSC that it must report the events to the federal Department of Labor. Throughout this time Williams was ignorant of Kilroy's confession in Las Vegas.

On October 1, the Department of Labor opened a civil investigation of the NCSC affair. The Department's investigator, James Pitt, met with NCSC staff and, in late October, reported his findings to Assistant United States Attorney Harry Benner of the U.S. Attorney's office in the District of Columbia. Benner telephoned Stanley Parry, a special prosecutor with the Las Vegas team, who sent Benner a copy of Kilroy's Las Vegas plea agreement. Parry also told Benner that Kilroy had confessed to the NCSC embezzlement, but provided no further details. At the end of October, Benner met with Pitt, informed him of the plea agreement, and warned him to base his investigation on sources independent of the Las Vegas investigations.

Sometime in 1986, however, Pitt contacted FBI Agent Mark Kaspar, in charge of the Las Vegas investigations, and one of two agents to whom Kilroy had confessed his embezzlement. Kaspar refused to provide Pitt with records concerning Kilroy, but told Pitt of Kilroy's admission; Kaspar added the warning that the admission fell within the government's grant of immunity. By late 1987, Pitt had finished his civil investigation and compiled a report that recommended legal action against Kilroy. In February 1988, Pitt obtained records of Kilroy's immunized statements from the Baltimore FBI office; apparently Pitt kept these documents separately from the civil investigatory file he had previously developed.

In December 1986, the Department of Labor opened a criminal investigation of the NCSC affair under the supervision of Robert Wagner. At the outset Benner told Wagner not to seek information from the FBI offices in Las Vegas or Baltimore and told him to warn those he interviewed not to reveal to him knowledge derived from immunized testimony. Wagner interviewed NCSC staff and, at the end of 1986, reviewed the civil files then compiled by Pitt. Informed by financial and tax records obtained from these sources, Wagner testified about Kilroy's embezzlement before a grand jury in Washington, D.C., on March 31, 1987 and on February 23, March 2, and March 9, 1990. Wagner was the only witness to testify and did not relate any of Kilroy's immunized statements. See United States v. Kilroy, 769 F.Supp. 6, 10 & n. 7 (D.D.C.1991) (describing sources and content of Wagner's testimony).

On March 26, 1990, the District of Columbia grand jury returned the indictment presently under review. Kilroy moved to dismiss the indictment on several grounds. Pertinent to the present appeal, he sought either to quash the indictment or suppress substantially all of the evidence against him on grounds that it was derived either directly or indirectly from information he had imparted under the government's promise of use immunity, in violation of the rule of Kastigar v. United States, 406 U.S. 441, 92 S.Ct. 1653, 32 L.Ed.2d 212 (1972). Benner and Wagner read all of Kilroy's immunized statements in the FBI files in Las Vegas and Baltimore. ¹ Judge Jackson rejected all of Kilroy's motions in a published opinion. See Kilroy, 769 F.Supp. at 6. With reference to the Kastigar ground preserved for appeal, that is Kilroy's claim that the indictment was obtained using "tainted" evidence in violation of the immunity agreement, the district judge found that the indictment was entirely based on the testimony of Wagner, who appeared before the grand jury multiple times. The court further found that Wagner was at no time prior to his testimony privy to information developed in breach of the immunity agreement and thus could have imparted none to the grand jury.

II. THE LEGAL FRAMEWORK

Kilroy's argument rests on the principle, fundamental to our constitutional government, that a citizen is free "from governmental compulsion to testify against himself." United States v. North, 910 F.2d 843, 853, reh'g granted in part, 920 F.2d 940 (D.C.Cir.1990), cert. denied, 500 U.S. 941, 111 S.Ct. 2235, 114 L.Ed.2d 477 (1991). Fundamental as the prohibition against the prosecution's use of compelled testimony is, it is not absolute. Under 18 U.S.C. Sec. 6002, the court may, upon the motion of the prosecution, compel a witness to testify even as to matters that incriminate him. However, the constitutionality of this compulsion depends upon the prohibition contained in the statute that "no testimony or other information compelled under the order (or any information directly or indirectly derived from such testimony or other information) may be used against the witness in any criminal case, except a prosecution for perjury, giving a false statement, or otherwise failing to comply with the order." 18 U.S.C. Sec. 6002. See Kastigar v. United States, 406 U.S. 441, 458, 92 S.Ct. 1653, 1663-64, 32 L.Ed.2d 212 (1971) (upholding the constitutionality of 18 U.S.C. Sec. 6002 because the statutory "immunity from use and derivative use is coextensive with the scope of the [Fifth Amendment] privilege").

The Kastigar decision is the seminal case in use immunity jurisprudence. Kastigar, as applied in this Circuit in North, provides the framework for analysis applicable to prosecutions of previously immunized witnesses: for a prosecution to proceed over the objection of an immunized witness, the court must hold a hearing in which the "heavy burden" is on the government to demonstrate "that it obtained all of the evidence it proposes to use [or has used] from sources independent of the compelled testimony." North, 910 F.2d at 854. The parties and the district court assumed that the Kastigar framework applied in this case. As this case involved an attempt to retroactively immunize statements, we question that proposition.

The purpose of the Kastigar hearing is to determine whether or not coerced testimony has been used against the witness in violation of his Fifth Amendment rights. See generally North, 910 F.2d at 853-73. A plea agreement that purports to immunize testimony already given can hardly have compelled that testimony, and the Kastigar framework seems ill-suited to analyze an allegation of the violation of such an immunity agreement. Neither this Circuit nor any other has ever analyzed this novel concept of "retroactive use immunity." Only two district court opinions from a single district have alluded to "retroactive immunity." Moreover, neither of them, even if authoritative, lends any support to a generalized acceptance of such a concept, or provides any framework for analysis. See United States v. Castellano, 610 F.Supp. 1137, 1140 (S.D.N.Y.1985) (noting without comment that an immunity order "was amended to grant ... retroactive immunity to [a prior] appearance," by a...