Opinion
Case No. 03-20248-CR-ALTONAGA/BANDSTRA
October 9, 2003
THIS CAUSE came before the Court on the Government's Motion for Reconsideration of Order Denying Government's Motion to Disqualify Roy Kahn as Trial Attorney for Defendant and For Reconsideration of Order Quashing Subpoena (D.E. 38). The undersigned has carefully reviewed the Motion and record, has heard argument of counsel, and has considered applicable law.
PROCEDURAL HISTORY
On August 28, 2003, Plaintiff, United States of America, and Defendant, Nir Gouaz (hereinafter "Gouaz"), appeared for the commencement of a criminal jury trial. Before the panel of jurors which had been summoned for this case entered the courtroom, counsel for the Government advised that Roy Kahn, counsel for Gouaz, had recently informed the Government that Gouaz would be presenting a defense of good faith reliance upon the advice of counsel. As such, the Government was of the opinion that Mr. Kahn would have to be disqualified, and the trial postponed. Jury selection nonetheless proceeded, and this issue was again addressed before the panel was sworn. The undersigned denied the Government's ore tenus motion to disqualify counsel for the Defendant, and quashed a subpoena that had been served on defense counsel to ensure his appearance as a Government rebuttal witness. Following additional argument, and the submission of written memoranda on the Government's request for a reconsideration, the panel was released and the trial continued pending resolution of this issue.
Defendant, Gouaz, was arrested on March 12, 2003, and charged with theft of government property, in violation of Title 18, United States Code, Section 641. According to the Government's proffer, Manuel Miranda, a cooperating witness, had previously identified Gouaz as having involvement with money laundering. On October 17, 2002, Gouaz and Miranda had a meeting in which Miranda told Gouaz that Miranda knew drug dealers who wanted to convert cash into cashier's checks. Gouaz is said to have expressed his willingness to launder money for the drug dealers. On December 12, 2002, Miranda passed $26,500 in IRS monies to the Defendant: $25,000 was to be converted into a cashier's check and $1,500 was Defendant's 6% commission for the laundering.
Rather than supply Miranda with the promised cashier's check, on December 18, 2002, Gouaz provided Miranda with a $25,000 company check that was allegedly rejected due to insufficient funds. After Miranda's attempts to recover the $25,000 in cash or cashier's check from Gouaz were unsuccessful, the Defendant was arrested and charged with the theft of government property. Gouaz' anticipated defense to the charge of theft is that, in holding on to the funds and not returning them to Miranda, he was merely following the advice of counsel, who had opined that to convert the funds would amount to money laundering. The Government maintains, therefore, that disqualification of Mr. Kahn is necessary as his testimony will be needed by the Government on rebuttal, in order for the Government to show that all of the elements of the defense of reliance upon advice of counsel have not been established.
LEGAL DISCUSSION
The question of disqualification of counsel implicates Sixth Amendment rights of the accused, the interest of the courts in preserving the integrity of the judicial process, and the interest of the government in ensuring a just verdict and fair trial. United States v. Locascio, 6 F.3d 924, 931 (2d Cir. 1993) (citing Wheat v. United States, 486 U.S. 153, 160(1988)). Thus, although "[r]etaining counsel of choice is a `right of constitutional dimension,'" this "right is not absolute." United States v. Wallert, 733 F. Supp. 570, 572 (E.D.N.Y. 1990) (quoting U.S. v. Arrington, 867 F.2d 122 (2d Cir. 1989)). As stated by the Court in Wheat:
[w]hile the right to select and be represented by one's preferred attorney is comprehended by the Sixth Amendment, the essential aim of the Amendment is to guarantee an effective advocate for each criminal defendant rather than to ensure that a defendant will inexorably be represented by the lawyer whom he [or she] prefers.486 U.S. at 159. The presumption favoring an accused's choice of counsel may be overcome, therefore, by a showing of actual conflict or potentially serious conflict. Locascio, 6 F.3d at 931.
The Government seeks Mr. Kahn's disqualification from participation at trial on the ground that he is a likely trial witness. To defeat Gouaz' reliance on the advice of counsel defense, the Government would call Mr. Kahn to testify about the knowledge and information Mr. Kahn had which formed the basis for any advice he gave the Defendant to keep the $26,500 provided by Molina. This is consistent with the elements required for an instruction on good faith reliance upon advice of counsel, which provides, in part, as follows:
Good faith is a complete defense to the charge in the indictment since good faith on the part of the Defendant is inconsistent with the existence of willfulness which is an essential part of the charge. The burden of proof is not on the Defendant to prove good faith, of course, since the Defendant has no burden to prove anything.
. . .
So, a Defendant would not be "willfully" doing wrong if, before taking any action with regard to the alleged offense, the Defendant consulted in good faith an attorney whom the Defendant considered competent, made a full and accurate report to that attorney of all material facts of which the Defendant had the means of knowledge, and then acted strictly in accordance with the advice given by that attorney.
ELEVENTH CIRCUITPATTERN JURY INSTRUCTIONS, Criminal, Special Instruction 18; see also United States v. Condon, 132 F.3d 653, 656 (11th Cir. 1998) (To be entitled to instruction, "defendant must show that (1) he [she] fully disclosed all material facts to his [her] attorney; and (2) he [she] relied in good faith on advice given by his [her] attorney."). The Government would seek from Mr. Kahn, in rebuttal, testimony concerning the "full and accurate report" given to him by Gouaz of "material facts," as well as the precise nature of the advice given.
The Government was unable to probe, through questioning of Mr. Kahn, the substance of his testimony on the good faith reliance on advice of counsel defense, because such questioning would have deprived Gouaz of representation, and would have violated the attorney-client privilege before the Defendant in fact waived the privilege by testifying as to the defense at trial. Thus, the Government was left speculating as to the nature of Mr. Kahn's expected testimony, and its necessity in the Government's rebuttal. Nonetheless, Mr. Kahn offered to eliminate from the jury's knowledge any mention that he, rather than some other attorney, was the one who provided Gouaz the advice. Furthermore, upon questioning, the Defendant waived any conflict of interest and recognized that if Mr. Kahn continued to represent him at trial, the Defendant would be deprived of utilizing Mr. Kahn as a defense witness, to corroborate the good faith reliance on advice of counsel defense.
Therefore, the issues presented are: (1) whether the undersigned should reject these agreed-to limits, and disqualify Mr. Kahn from continued participation as trial counsel because otherwise the Government is deprived of a potentially necessary witness; and (2) whether the integrity of the judicial process and the fairness of the trial will be compromised if he is not so disqualified. Initially, the undersigned observes that an attorney may not act as both an advocate and a witness in the same proceeding. United States v. Defazio, 899 F.2d 626, 631 (11th Cir. 1990); see also Rule 4-3.7, Rules Regulating the Florida Bar. As to the first question, the Government argues in its memorandum that "no case law requires that the government demonstrate that a witness it intends to call at trial is a necessary witness," (Gov't Mot. Recons. at 8), in order to warrant defense counsel's disqualification. The Government acknowledges that although some cases have mentioned this as the analytical framework, whether the lawyer-witness was key was not determinative of the outcome.
The analytical framework articulated in United States v. Hobson, 672 F.2d 825 (11Sth Cir. 1982), abrogated on other grounds by Flanagan v. United States, 465 U.S. 259 (1984), and followed in United States v. Urbana, 770 F. Supp. 1552 (S.D. Fla. 1991), for cases where the facts show impropriety by defense counsel as a basis for disqualification, is inapplicable here, where the issue is whether disqualification is necessary because an attorney will be both advocate and witness.
Rule 4-3.7 of the Rules Regulating The Florida Bar provides in pertinent part:
(a) When Lawyer May Testify. A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness on behalf of the client except where:
(1) the testimony relates to an uncontested issue;
(2) the testimony will relate solely to a matter of formality and there is no reason to believe that substantial evidence will be offered in opposition to the testimony;
(3) the testimony relates to the nature and value of legal services rendered in the case; or
(4) disqualification of the lawyer would work substantial hardship on the client.
Notwithstanding the Government's characterization of the decisional law as perhaps results-oriented, a review of applicable law reveals that, in exercising its discretion of allowing a defending or prosecuting attorney to testify in a case he or she is trying, a court should examine whether the party seeking such testimony has shown that "the evidence is vital to his [or her] case, and that his [or her] inability to present the same or similar facts from another source creates a compelling need for the testimony." United States v. Watson, 952 F.2d 982, 986 (8th Cir. 1991). Thus, "4[i]n recognition of the fact that a move to disqualify trial counsel has inherent tactical advantages . . . the Second Circuit has required a showing of necessity from the movant'. Moreover, that necessity must be `compelling and legitimate.'" United States v. Bin Laden, 91 F. Supp.2d 600, 623 (S.D.N.Y. 2000) (citations omitted) (quoting United States v. Perlmutter, 637 F. Supp. 1134, 1137 (S.D.N.Y. 1986) and United States v. Regan, 103 F.3d 1072, 1083 (2d Cir. 1997)). Upon reconsideration, under the circumstances presented, the Government has met this burden.
Unquestionably, the circumstances show that Mr. Kahn is the only witness other than the Defendant to the alleged conversation where advice of counsel was given. Only Mr. Kahn will be able to testify as to the precise content of the conversation he had with Gouaz, the facts relayed to him by the Defendant, and the substance of his advice to Gouaz. The nature of the testimony is not peripheral to the case; rather, it is highly material as it goes to the heart of the key defense Gouaz intends to present. Without the ability to subpoena Mr. Kahn, and have him testify, the Government will be left with only the ability to try to impeach Gouaz' version of that conversation, while the jury is left pondering the identity of the phantom lawyer who gave the advice.
Although initially the undersigned was of the opinion that Mr. Kahn's testimony would only serve to corroborate that of his client, and would hardly qualify as necessary rebuttal evidence, "[i]f the prosecution is otherwise justified in calling an attorney as a witness, `[i]t is inconceivable that defendant's right to a particular counsel should be permitted to impose . . . artificial disadvantages upon the government,' by restricting whom it can call at trial." United States v. Castellano, 610 F. Supp. 1151, 1162 (S.D.N.Y. 1985) (quoting United States v. Cortellesso, 663 F.2d 361, 363 (1st Cir. 1981)); see also Grady v. United States, 715 F.2d 402, 404 (8th Cir. 1983)("The government cannot be expected to risk its case by not calling defense counsel if his testimony is important."). Having demonstrated that Mr. Kahn is the only available witness to the conversation, and having been restricted by the Defendant in its ability to examine Mr. Kahn to determine if, in fact, the testimony would contradict that of Gouaz, the Government has met its burden of demonstrating the need to have Mr. Kahn participate as witness rather than advocate. Cf. United States v. Diozzi, 807 F.2d 10, 13 (1st Cir. 1986) (error to disqualify defense counsel where testimony was not shown to be necessary in light of defendant's stipulation to contents of written submissions and power of attorney forms alleged to be material evidence of defendants' misrepresentations). Whether or not the Government does indeed call Mr. Kahn as a rebuttal witness has no significance for purposes of this analysis, because a disqualification is appropriate when a potential conflict exists. See Wheat, 486 U.S. at 163 (finding that "district court must be allowed substantial latitude in refusing waivers of conflict of interest not only in those rare cases where an actual conflict may be demonstrated before trial, but in the more common cases where a potential for conflict exists which may or may not burgeon into an actual conflict as the trial progresses."). Defense counsel will be circumscribed not only by the oath he would have to take as a witness, but by his oath as a lawyer, providing additional guarantees that his answers to the Government's questions concerning this essential element of the defense, if asked, will be truthful and complete.
The second issue presented, i.e., the integrity of the judicial process and the concomitant interest in ensuring a fair trial, also compels a reconsideration of the undersigned's initial denial of the requested disqualification. The prohibition on lawyers appearing as witnesses in cases where they serve as advocates is grounded in important concerns over the integrity of the adversary system. See Bin Laden, 91 F. Supp.2d at 623. As observed by the Court in Wheat, "[f]ederal courts have an independent interest in ensuring that criminal trials are conducted within the ethical standards of the profession and that legal proceedings appear fair to all who observe them." 486 U.S. at 160; see also United States v. Register, 182 F.3d 820, 832 (11th Cir. 1999) (affirming disqualification of defense counsel and relying upon Wheat). But see Bin Laden, 91 F. Supp.2d at 624-25 (redaction of documents and instruction to witnesses could cure prejudice to defense of having government lawyer as an "unsworn witness.").
Mr. Kahn has an obvious conflict of interest with his client: it behooves defense counsel to ensure that Gouaz testifies as to all elements of the good faith reliance on counsel defense, and yet only Mr. Kahn knows whether or not that testimony, once elicited, is truthful and accurate. "When an actual conflict of interest exists, the client is denied effective assistance of counsel, and the attorney may be disqualified." United States v. Ross, 33 F.3d 1507, 1523 (11th Cir. 1994). Moreover, "[w]here defense counsel's testimony is important to the government's case, the best alternative is for counsel to withdraw." Grady, 715 F.2d at 404; see also Defazio, 899 F.2d at 632 (finding that attorney's testimony was not available through other sources if advice of counsel defense had been raised). The Defendant's waiver of conflict and acknowledgment that he would be deprived of a material witness in his defense if Mr. Kahn were permitted to participate as trial counsel, do not need to be accepted. Wheat, 486 U.S. at 162 ("where a court justifiably finds an actual conflict of interest, there can be no doubt that it may decline a proffer of waiver . . ."); United States v. Spears, 965 F.2d 262, 276 (7th Cir. 1992). Indeed, honoring his waiver may invite future attacks over its adequacy and the fairness of the proceedings, that the undersigned is not willing to countenance as possible post-verdict arguments. See Wheat, 486 U.S. at 162. Compare Locascio, 6 F.3d at 934 ("When an attorney is an unsworn witness, . . . the detriment is to the government, since the defendant gains an unfair advantage, and to the court, since the fact finding process is impaired. Waiver by the defendant is ineffective in curing the impropriety in such situations, since he is not the party prejudiced.")
Accordingly and for the foregoing reasons, it is ORDERED AND ADJUDGED that the Government's Motion for Reconsideration of Order Denying Government's Motion to Disqualify Roy Kahn as Trial Attorney for Defendant and For Reconsideration of Order Quashing Subpoena is GRANTED. Roy Kahn is disqualified as counsel of record, and Defendant is to either secure new counsel or advise the Court that he wishes to represent himself, in which case an evidentiary hearing will be scheduled.
DONE AND ORDERED in Chambers at Miami, Miami-Dade County, Florida