Opinion
Crim. No. 13-0074 (RMB)
05-26-2016
UNITED STATES OF AMERICA, v. DIANTONIO, et al., Defendants.
[Dkt. No. 65]
OPINION
This matter comes before the Court upon the filing of a motion for dismissal of the indictment by Defendant Frederick M. DiAntonio ("Mr. DiAntonio") as a result of alleged prosecutorial misconduct that occurred during Mr. DiAntonio's grand jury appearance as the custodian of records for Blue Ocean Realty. [Dkt. No. 65.] Defendant Louis Catarro ("Mr. Catarro," and with Mr. DiAntonio, "Defendants") joined this motion on April 17, 2015. [Dkt. No. 83.] On December 2, 2015, this Court denied Defendants' motion, reserving the reasoning for that Order for a subsequently issued opinion. [Dkt. No. 109.] This Opinion sets forth the reasoning for the Court's denial of that motion.
I. FACTUAL BACKGROUND
As an initial matter, the motion to dismiss the indictment arises from the grand jury testimony that Mr. DiAntonio delivered as the custodian of records for Blue Ocean Realty. By way of brief background, Mr. DiAntonio and Mr. Catarro have been indicted in this case for three offenses: (1) conspiracy to commit wire fraud, (2) conspiracy to commit money laundering, and (3) false statements to HUD. [Dkt. No. 1 (Hereinafter, "Indictment at ¶___.").) As set forth in the indictment, the Defendants were purportedly involved in a scheme centering on $15 million in real estate transactions supposedly underpinned by fraudulent mortgage loan applications. (Id. at ¶ 15.)
Specifically, the Government alleges that Mr. DiAntonio, a licensed realtor in New Jersey, is the co-owner of Blue Ocean Realty, located in Wildwood, New Jersey. (Id. at ¶ 1.) Working with other co-conspirators, Mr. DiAntonio and Mr. Catarro located properties for sale in Wildwood and North Wildwood, New Jersey. (Id. at ¶ 15.) Thereafter, co-conspirator John Lucidi allegedly induced individuals to purchase properties in these areas by telling them "they would receive cash back at closing and could flip the property at a later date for a profit." (Id.) Mr. DiAntonio and others would then generate real estate sales contracts which listed inflated sales prices and indicated deposit money from buyers had been received which were not actually collected. (Id. at ¶ 17.)
John Lucidi is named as a co-conspirator in the indictment, but is not a named defendant. (Indictment at ¶ 1(e).) Mr. Lucidi was employed as a mortgage broker in Pennsylvania. (Id.)
Many of these real estate sales contracts contained addenda which listed money amounts the buyers would receive at closing. (Id. at ¶ 18.) These amounts, however, were not disclosed on the Housing and Urban Development Settlement Statements ("HUD-1 Settlement Statements."). (Id.) Mortgage loan applications were then prepared, without disclosing that a buyer was receiving what allegedly amounted to "kickbacks" or that the buyer had not actually paid a deposit toward the purchase of the property. (Id. at ¶ 19.) The object of the conspiracy, as told by the Government, was to profit from the sale of the real estate which was "overbuilt by financially distressed developers in Wildwood and North Wildwood, New Jersey, and other properties . . . by obtaining mortgage loans for unqualified borrowers using fraudulent loan applications, HUD-1 Settlement Statements, and other documents." (Id. at ¶ 13.)
A. The Grand Jury Proceedings
As part of the proceedings before the grand jury tasked with investigating possible violations of criminal law including mortgage fraud, Mr. DiAntonio appeared as a witness. He appeared not in his individual capacity, but rather in his capacity as the custodian of records for Blue Ocean Realty. (Grand Jury Tr. at 4:8-12.) The Prosecutor's first set of questions directed at Mr. DiAntonio confirmed this:
Q: Okay. You are appearing as the custodian of records for Blue Ocean Realty, correct?(Id.)
A: Yes.
Q: Not in your individual capacity?
A: Yes.
While Defendants contend that the Government knew either Mr. DiAntonio or Mr. Catarro would appear as custodian of records, the revelation of Mr. DiAntonio's specific appearance came, at the very least, on short notice. On April 27, 2010, one day prior to taking the stand to testify as the custodian of records, Mr. DiAntonio's then-counsel informed the Government by letter to Agent Stefanowicz, that,
The Government contends it did not know who would appear as custodian of records at all.
Mr. DiAntonio is only testifying to the authenticity of the records that have already been provided to the F.B.I. Furthermore, please take notice that Mr. DiAntonio will be invoking his 5th Amendment rights as it relates to any and all questions to be asked by the U.S. Attorney before the grand jury that are considered beyond the scope of the authenticity of the aforementioned records.(Defs.' Br. Ex. A.) According to the Government, this letter was not shared with the prosecutor until the morning of the grand jury session. (Gov.'s Opp. Br. at 8.) This is confirmed by the initial questioning during the grand jury proceedings:
Q: Good morning. Sir can you please state your name and spell it for the record?
A: Fred, Fredric DiAntonio, F R E D R I C, DiAntonio, D I A N T O N I O.(Grand Jury Tr. at ¶ 3.)
Q: And just so - we weren't sure who - we understand that you're appearing here as the custodian of records for Blue Ocean Realty . . .
We were unsure who would be appearing today, so just by a show of hands, do any members of the Grand Jury know Mr. DiAntonio? Okay. I see no show of hands.
Directly after confirming that Mr. DiAntonio was appearing in his capacity as custodian of records for Blue Ocean Realty, the following questions by the Prosecutor and answers by Mr. DiAntonio were exchanged:
Q: Okay. You are under a legal obligation to testify truthfully on behalf of the company. Do you understand that?(Grand Jury Tr. at 4:13-5:5.)
A: Yes.
Q: Okay. So you must, therefore, give truthful answers today in response to all questions put to you, either by me or any member of the Grand Jury. Do you understand that?
A: Yes.
Q: All right. If you should lie or knowingly make false statements in your testimony, you or Blue Ocean Realty could be prosecuted for the crimes of perjury, making false declarations or statements, or obstruction of justice. If you, in your individual capacity, were deemed to have lied or knowingly made false statements, you could be sentenced to imprisonment and fined. Do you understand that?
A: Yes.
The prosecutor thereafter proceeded to ask Mr. DiAntonio a series of questions concerning documents that had been produced by Blue Ocean Realty in response to Government subpoenas. Throughout the testimony, an attorney from the firm representing Blue Ocean Realty and Mr. DiAntonio, Mr. Polis, was available outside the Grand Jury's presence to speak with Mr. DiAntonio. (Id. at 5:17-5:20.) The prosecutor instructed Mr. DiAntonio that he was able to speak with his attorney at any point. (Id. at 7:2-8.)
Throughout the course of the testimony, Mr. DiAntonio frequently invoked his Fifth Amendment right against self-incrimination. Indeed, he invoked it at least five times throughout the proceedings. For instance, the first such time Mr. DiAntonio asserted his Fifth Amendment privilege—roughly a quarter of the way through his testimony—the exchange proceeded as follows:
Q: Okay. And just in general terms, do the types of records that you would, as the custodian of records, would know about, would those include files in which real estate transactions in which Blue Ocean was involved, would that those documents be created [sic], is that right?
A: I guess so, yeah.
Q: So for example, HUD1 statements, settlement sheets, correspondence, that type of a thing?
A: I would plead the Fifth. Can I plead the Fifth?
Q: Not - are you, are you - let me ask -
A: I don't know what type of direction your questions are going into and I'm just trying to understand it. That's all.(Id. at 9:1-20.)
Q: Okay. Well, sir, I understand that you've been offered, as the custodian of records, I'm simply asking if the records that are maintained, about which you are aware, include certain things like settlement sheet - things that will be part of a real estate transaction?
A: Yes, yes.
A second time Mr. DiAntonio asserted his privilege came in an exchange related to the Government's questioning concerning the files produced, and an addendum attached:
Q: All right. And then turn to that third tab, and do you see here - here is a document, I'm going to try to forward it there. It's that third tab. And it's titled addendum to the contract of sale dated February 17th, 2007?
A: Yes.
Q: Okay. And that means this gets attached to the contract and it is - and basically changes the contract, right, as far as you understand it? In other words, it adds to the contract?
A: I'll plead the Fifth on that.
Q: Okay. Well, let me ask you in your capacity as the custodian of records, is this an - is this something that was in Blue Ocean Realty's file?
A: Yes.
Q: Okay. And so this says here that the seller will give an $8,000 seller assist to the buyer at closing on the HUD sheet, and then it's signed by carious people to the transaction, correct?
A: Yes.
Q: All right. Now that seller assist, do you know what that is? I mean, I'm just curious if you know what a seller assist it?(Id. 22:20-24:7.)
A: It's, it's - I don't know about - a seller assist is something that I guess that they give back, you know, the seller gives back to the buyer for, for - out of closing.
Q: Okay. And so - and it says here, again, $8,000 to assist the buyer at closing on the HUD sheet, and then if you look at that first page, it's actually on there?
A: Yeah, you highlighted it. It says 8,000 seller assistance.
Q: Yeah. I think I didn't highlight it on this copy, but there's the - on item 209, seller assist, and there's the $8,000, right?
A: Correct.
Q: Okay. And again, these are the types of records that would just be on file at Blue ocean Realty, right?
A: Yes, sir.
The examination continued to discuss the documents provided by Blue Ocean Realty in response to subpoenas. After asking Mr. DiAntonio if the documents produced were "complete, meaning everything relating to the transactions for those - for that real estate purchase will be in there," Mr. DiAntonio again asserted his Fifth amendment right. (Id. at 32:4-7.) This exchange followed:
Q: Well, sir, when you say you plead the Fifth, I mean you're appearing hear as the custodian of records -
A: Oh, oh, I understand what you're saying. Yes, yes, it's what's in my file, yes.
As the examination of Mr. DiAntonio continued, he continued to assert his Fifth Amendment privilege against self-incrimination at various intervals. Another invocation of his Fifth Amendment privilege occurred during an exchange about addendums to sales contracts which disclosed payments back to sellers:
Q: Okay. And this is, again, is that the seller's assist, of where the seller will give an $8,000 - or will give $8,000 to the seller - assist the buyer at closing on the HUD sheet, right?(Id. at 36:15-37:9.)
A: I - yes.
Q: Okay.
A: I plead the Fifth on that stuff.
Q: Okay. So in other words, you're not - what you're doing is, you are invoking, in your individual capacity, your Fifth Amendment privilege against self-incrimination pertaining to the substance of the files, but as the custodian of records, you are acknowledging that this is a record that was maintained and -
A: At the office.
Mr. DiAntonio's final invocation of his Fifth Amendment privilege occurred as the Government sought testimony concerning a second set of records that were not produced by Blue Ocean Realty. Instead, a comparison between what was produced by Blue Ocean Realty and documents available to the Government through other means was sought:
Q: Do you recognize that this property here that's for this addendum to the contract of sale is the purchase of
the property by Steven Pfizenmayer from Bay Breeze Development for that property address, 2403 Surf Avenue, North Wildwood, New Jersey?
A: I plead the Fifth.
Q: Well, do you see that on the screen?
A: What?
Q: Or look at the Exhibit. Do you see that?
A: Yes.
Q: Do you see that's what that says?
A: Oh, yeah.
Q: Okay. Now, compare that to Grand Jury Exhibit 7A [from the Blue Ocean Realty production] for a second. And if you look at 7A, can you see that that's the same real estate transaction in 10A is also in 7A? In other words, this purchase by Steven Pfizenmayer from Bay Breeze Development for 2403 Surf Avenue, North Wildwood?
A: Yes.
Q: Okay. Now earlier I understood that you said that the files that Blue Ocean Realty turned over to Special Agent Stefanowicz were maintained in the ordinary course of business were complete. Can you explain to the members of the Grand Jury, as a custodian of records, why Blue Ocean Realty 10A was not contained in your files?
A: I plead the Fifth.
Q: You have no explanation for the Grand Jury? You're not appearing here as the - in your individual capacity. The company doesn't have a Fifth Amendment privilege, so can you explain why this wasn't in the file?
A: I plead the Fifth.
Q: All right. Well, for the record, in looking at the file, do you see here that - I just want to ask you if you see this on the record? Do you see that this addendum to the contract says the seller will credit the buyer at settlement $50,000, which will be off the HUD sheet, made
payable to Steven Pfizenmayer? Do you see that on this Grand Jury Exhibit?
A: Yes, sir.
Q: And if you look at 10B and 10C, those are basically the same. In other words, these addendums to the contracts - and I'll represent to you those were not a part of Blue Ocean Realty's files, and I take it you're unable to answer why those were not included in the production, is that right?
A: No, I'm not.
Q: As the custodian of records, do you understand that the company produced - must produce all documents in its possession pertaining to the items requested in the subpoena?
A: Yes, sir.
Q: All right. And so, for the record then, the Grand Jury is commanding that you and Blue Ocean Realty produce any absent records that were maintained in the files. Do you understand that?
A: Yes.
Q: All right. And you have no ability to explain whether documents such as 10A, 10B or 10C were removed from your records. Is that right?
A: No, no.
Q: To whom should we address this, beyond you, as the custodian of records? Should it be your counsel, about these missing records?
A: I guess so, yeah.
Q: And that would be Mr. Stefankiewicz, or is it - is it Mr. Stefankiewicz or Mr. -
A: Mr. Polis?
Q: Polis, yes. Either one?
A: Yeah, Dave.
Q: All right. But again, you understand then, as the custodian of records, and as the owner of Blue Ocean Realty, that any, any record that has been - that is in your file that has been not produced, that's been withheld or for any other reason, must be provided to this Grand Jury?(Grand Jury Tr. at 38:4-41:4.)
A: Yes, sir.
Shortly after this exchange, the Government concluded Mr. DiAntonio's examination before the Grand Jury. On January 30, 2013, the Government filed an indictment of Mr. DiAntonio and Mr. Catarro—among others—in this Court. [Dkt. No. 1.]
As noted above, after an extended nearly two-year pre-trial period, Mr. DiAntonio and Mr. Catarro moved on December 5, 2014 to dismiss the indictment, arguing that Mr. DiAntonio was the victim of prosecutorial misconduct before the grand jury. Specifically, Mr. DiAntonio argues that the prosecutor compelled Mr. DiAntonio to answer questions in contravention of his personal Fifth Amendment privilege. After oral argument on the motion and supplemental briefing, this Court ruled on December 2, 2015 that the motion to dismiss the indictment was denied. [Dkt. No. 109.] Below, the Court sets forth its reasoning for that determination.
II. STANDARD
District Courts "have the power to dismiss an indictment based on prosecutorial misconduct." United States v. Breslin, 916 F. Supp. 438, 441 (E.D. Pa. 1996). Nevertheless, this is an extreme remedy and, correspondingly, a very demanding standard. United States v. Martino, 825 F.2d 754, 759 (3d Cir. 1987) ("In fact, in none of the Third Circuit cases in which we found prosecutorial misconduct before the grand jury did we order dismissal of the indictments."). And, because dismissal is the most drastic remedy, United States v. Bansal, 663 F.3d 634, 660 (3d Cir. 2011) (quoting United States v. Morrison, 449 U.S. 361, 365 n.2 (1981)), a dismissal may be ordered only if it can be shown that the failure to do so would actually "prejudice" the defendant. Id. "Prejudice" exists and the indictment should be dismissed "if it is established that the violation substantially influenced the grand jury's decision to indict,' or if there is 'grave doubt' that the decision to indict was free from the substantial influence of such violations." Bank of Nova Scotia v. United States, 487 U.S. 250, 254-55 (1988).
As an additional clarification, it is well-settled that the Fifth Amendment privilege against self-incrimination does not extend to corporations. In re Grand Jury Empaneled on May 9, 2014, 786 F.3d 255, 258-261 (3d Cir. 2015). To this end, the Supreme Court has acknowledged that a custodian of records may be subpoenaed to testify about records previously produced. Nevertheless, the custodian of records is privileged from being compelled "to do more than identify [the] documents already produced." Curcio v. United States, 354 U.S. 118, 125 (1957) ("A custodian, by assuming the duties of his office, undertakes the obligation to produce the books of which he is a cutosdian in response to a rightful exercise of the State's visitorial powers."). As such, a custodian cannot assert a Fifth Amendment privilege in his capacity as the custodian of records. However, to the extent that oral testimony is sought by the prosecution which goes beyond the scope of the custodian of records' identification, the Fifth Amendment privilege remains operative to be invoked by the individual. Id. ("[A custodian] cannot be compelled, in the absence of a grant of adequate immunity from prosecution, to condemn himself by his own oral testimony.").
III. ANALYSIS
A. Defendants' Argument
Defendants argue that Mr. DiAntonio was compelled to answer questions beyond the scope of document authentication. (Defs.' Br. at 14-21.) Specifically, Mr. DiAntonio argues that the actual compulsion took place in two ways. First, Defendants argue that Mr. DiAntonio was compelled by the Government's instruction to answer "all" questions at the outset of his grand jury testimony. In so doing, the prosecutor "impl[ied] that Mr. DiAntonio had to answer every question and could not assert the right to his Fifth Amendment privilege in response to any question." (Defs.' Supp. Br. at 5.)
Second, Defendants argue that the Government repeatedly "rejected" Mr. DiAntonio's assertions of the Fifth Amendment Privilege. (Defs.' Supp. Rep. Br. at 9.) Specifically, the Defendants argue that Mr. DiAntonio would time and time again assert his Fifth Amendment privilege only to be thwarted in so doing by a continuous stream of reformulations of the same question designed to ultimate deceive Mr. DiAntonio into revealing incriminating information. (Defs.' Supp. Br. at 6-12.) In so doing, the Government "indicat[ed] to Mr. DiAntonio that he could not afford himself of the protections of the Fifth Amendment in response to any question, and he had to answer all of the questions posed by [the prosecutor], even if a 'responsive answer to the question or an explanation of why it cannot be answered might be dangerous because injurious disclosure could result." (Defs.' Supp. Rep. Br. at 16. (quoting Hoffman v. U.S., 341 U.S. 479, 479 (1951).)
Ultimately, as a result of this purported disregard of Mr. DiAntonio's Fifth Amendment privilege, Mr. DiAntonio provided several pieces of personally incriminating information. Specifically, Defendants argue that Mr. DiAntonio provided information about his definition of a seller assist and his potential withholding of documents from the government. (Defs.' Br. at 16-17.) According to Defendants, the cumulative effect of the Government's conduct yields prejudice sufficient to dismiss the indictment.
B. Government's Argument
In response the Government argues that Mr. DiAntonio was not compelled to give testimony. Specifically, the Government offers that, "While a records custodian cannot be compelled by a Court to answer certain questions posed during a grand jury proceeding, the mere posing of questions does not amount to prosecutorial misconduct." (Gov. Supp. Br. at 4.) According to the Government, Mr. DiAntonio was free to—and did—exercise his Fifth Amendment privilege.
The Government also attacks the notion that the questions asked of Mr. DiAntonio were improperly calculated to reveal incriminating information and not information typically sought from a custodian of records. The Government focuses on the line of questioning concerning missing documents in a Blue Ocean Realty production. In arguing that these questions about missing documents could be legitimately posed to a custodian of records, the Government puts forward a list of possible, permissible answers this question could have received, such as: "Those missing documents were in a different location that I did not search. They are in our Los Angeles facility and I can get them for you." (Id. at 6.) Such answers, the Government argues, would of course be within the ambit of a custodian of records. "Thus, the question is not improper, and only the witness knows whether the invocation of the Fifth Amendment privilege would be proper." (Id. at 6.); see also In re Grand Jury, 869 F. Supp. 298, 308 (D.N.J. 1994) (Bassler, J.) ("[T]he touchstone for evaluating the appropriateness of the privilege where the custodian claims that oral testimony beyond the mere identification will violate the Fifth Amendment must be the incriminating tendency of the disclosure."). As such, no prosecutorial misconduct existed where the questions were proper and the witness was not compelled to answer questions.
C. Mr. DiAntonio Was Not Compelled to Answer
For a multitude of reasons, this Court cannot agree with Defendants' contention that Mr. DiAntonio was compelled by the Government to answer questions which might individually incriminate him. In so holding, the Court is mindful of the fact that ex parte examination of a witness, particularly one who is or may soon be a target of an investigation, is a potentially perilous situation from the standpoint of the Fifth Amendment. See generally United States v. Remington, 208 F.2d 567, 573 (2d Cir. 1953) ("Save for torture, it would be hard to find a more effective tool of tyranny than the power of unlimited and unchecked ex parte examination.") (Hand, J., dissenting).
Nevertheless, the upshot of the Supreme Court's jurisprudence in the context of document custodian examination reveals the malady is not in the examination of custodians (even those under individual investigation), but rather in the compulsion of an answer to questions in contravention of the invocation of the Fifth Amendment. Curcio v. United States, 354 U.S. 118, 2126 (1957) (holding the government may not "compel [a custodian] to disclose, by his oral testimony, the whereabouts of books and records which he has failed to produce" (emphasis added)). As the Government rightly points out, "[T]he mere fact that a witness cannot be compelled to answer a question that would incriminate him does not mean that merely asking the question is [necessarily] improper." (Gov. Supp. Br. at 5.) With this distinction clarified, it is evident from a searching review of the transcript and accompanying circumstances that Mr. DiAntonio was not compelled to answer any questions in violation of his Fifth Amendment privilege.
Initially, the Court is not persuaded that the mere instruction that Mr. DiAntonio must answer all questions "truthfully" amounts to an implicit compulsion that he must answer "all" questions. (Grand Jury Tr. at 4:17-5:4 ("So you must, therefore, give truthful answers today in response to all questions put to you, either by me or any member of the Grand Jury . . . If you should lie or knowingly make false statements in your testimony, you or Blue Ocean Realty could be prosecuted for the crimes of perjury.") Such a reading of a routine witness instruction is tortured at best. By any rational construction, the direction from the prosecutor is that Mr. DiAntonio may not answer untruthfully to any questions. The Court struggles to grasp how anyone hearing the instruction, in essence, "you must answer all questions truthfully," could misinterpret that instruction as a requirement that all questions be answered completely and without regard for any privilege. Moreover, even if the instruction could be so interpreted, Mr. DiAntonio certainly did not understand the instruction that way, as he repeatedly invoked the privilege throughout his testimony. (See Grand Jury Tr. at 9, 23, 32, 36, 39.)
To the extent Defendants argue that Mr. DiAntonio should have also been advised of his Fifth Amendment privilege at the outset of the examination, such argument is three-fold incorrect. As an initial matter, it is unclear that such a warning is ever necessary. United States v. Washington, 431 U.S. 181, 186 (1977) ("[N]or have we decided whether any Fifth Amendment warnings whatever are constitutionally required for grand jury witnesses."). Second, even if the Department of Justice policy requires that prosecutors inform targets of investigations of their Fifth Amendment privilege, such "Department of Justice guidelines and policies do not create enforceable rights for criminal defendants." United States v. Wilson, 413 F.3d 382, 389 (3d Cir. 2005). Finally, even if such an instruction were required, Mr. DiAntonio's consistent invocation of his rights demonstrates that no prejudice has inured unto him in that regard.
Likewise, the Government's re-calibration of questions in the wake of Mr. DiAntonio's continuous invocation of his Fifth Amendment privilege does not represent a compulsion to testify under these facts. In each instance of the assertion of the privilege, it is clear the Government did not relent in its examination of Mr. DiAntonio as custodian. But, the exchanges after the Mr. DiAntonio asserted the privilege do not amount to impermissible badgering of the witness to repeatedly invoke the Fifth Amendment or a coercive force. Rather the subsequent questions invariably re-focus the inquiry away from Mr. DiAntonio's personal actions and mental state and onto the actions he took as custodian and the associated knowledge. (See, e.g., Grand Jury Tr. at 23:4-8.) It would be strange to suggest that once the individual Fifth Amendment privilege is invoked by a custodian, any and all questions in the same universe—even an ordinarily permissible one such as, "Where are the missing documents?"—must be abandoned.
The Court is also unpersuaded by Defendants' argument that the Government misadvised Mr. DiAntonio of his Fifth Amendment rights. Defendants rely on United States v. Kennedy, 372 F.3d 686, 691 (10th Cir. 2004), for the proposition that a prosecutor may not improperlytell a witness that he is prohibited from invoking his Fifth Amendment rights. While the record indicates some back and forth between the Government and Mr. DiAntonio concerning whether he was seeking to answer a question as an individual or the custodian of records, (see e.g. Grand Jury Tr. at 32:4-11), the record is devoid of any suggestion that the Government told Mr. DiAntonio he was not allowed to invoke his individual Fifth Amendment privilege in response to any question. Indeed, the opposite appears true. (Grand Jury Tr. at 36:22-37:2 ("Q: Okay. So in other words, you're not - what you're doing is, you are invoking, in your individual capacity, your Fifth Amendment privilege against self-incrimination pertaining to the substance of the files, but as the custodian of records, you are acknowledging that this is a record that was maintained . . . at the office. Okay that's fine."))
For instance, when asked if the documents in a loan file produced by Blue Ocean Realty were "complete," Mr. DiAntonio asserted his Fifth Amendment privilege. (Grand Jury Tr. at 31:25-32:11.) This customary custodian question came at the heel-end of other questions meant to authenticate the documents. (Id.) The Government responded, "Well, sir, when you say you plead the Fifth, I mean you're appearing here as the custodian of records -" and before another question was posed, Mr. DiAntonio inserted, "Oh, oh, I understand what you're saying. Yes, yes, it's what's in my file, yes." (Id.) The fact that the prosecutor sought to understand whether Mr. DiAntonio was able to speak to any portion of the file's completeness without individually incriminating himself does not amount to a "trampling" of his Fifth Amendment privilege. (Defs.' Supp. Rep. Br. at 13.) The same is true across all other invocations of the Fifth Amendment by Mr. DiAntonio. Contrary to Defendants' argument, at no point did the prosecutor refuse to accept Mr. DiAntonio's personal invocation of his privilege. (See e.g., Grand Jury Tr. at 36:22-37:2.)
Finally, and most tellingly, Mr. DiAntonio's conduct throughout the Grand Jury testimony evidences the fact he did not believe himself required to answer questions beyond the scope of authenticity. As Mr. DiAntonio concedes, he invoked the Fifth Amendment privilege against self-incrimination repeatedly. (See Grand Jury Tr. at 9, 23, 32, 36, 39.) While he did not always re-assert that privilege when the question was changed or more closely tethered to his capacity as custodian of records, that does not mean that he was somehow duped into answering impermissible questions in a coercive manner.
The Court is also unpersuaded by Defendants' argument that U.S. v. McLaughlin, 126 F.3d 130 (3d Cir. 1997), stands for the proposition that Mr. DiAntonio's Fifth Amendment privilege in this case was self-executing and not waived by his decision to answer questions. (Defs.' Supp. Br. at 12.) McLaughlin stands for the relative straightforward proposition that Braswell v. U.S., 487 U.S. 99 (1988), which dictates that the Fifth Amendment privilege prevents prosecutors from making any evidentiary use of an individual defendant's production of documents in his or her custodial capacity, also applies to an individual's non-production of documents and does not need to be separately invoked at production. Put differently, the holding of McLaughlin is simply that where a defendant fails to produce certain documents in his or her custodial capacity in response to a subpoena, the prosecution may not make evidentiary use of that failure. Id. at 134 ("[T]he testimonial aspect of production is not limited to the act of handing material over to the Government—it also may include the custodian's exercise of discretion over which material to produce and which to omit."). In this case, the Government has repeatedly stated that it will make no evidentiary use of Mr. DiAntonio's production or non-production of documents. As such, McLaughlin is inapposite to the issue before the Court.
The Court in Braswell held that "[t]he Government may not introduce into evidence . . . that the subpoena was served upon and the corporation's documents were delivered by one particular individual, the custodian." 487 U.S. at 118.
IV. CONCLUSION
In sum, the Government is correct that neither it nor any Court, could have compelled Mr. DiAntonio to answer any question in contravention of his Fifth Amendment privilege. (Gov. Supp. Br. at 7.) Nevertheless, where the Defendant answers questions posed to him—particularly questions that are proper to be asked of a custodian of records—no prosecutorial misconduct has been committed. Accordingly, the Court holds that the Government did not engage in prosecutorial misconduct. The dismissal of the indictment in this case would be improper. Defendants' motion seeking such relief is, accordingly, DENIED. DATED: May 26, 2016
In so holding, the Court does not reach the issue of whether, if such conduct amounted to prosecutorial misconduct, Defendants were prejudiced by it. --------
s/Renée Marie Bumb
RENÉE MARIE BUMB
UNITED STATES DISTRICT JUDGE