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UNITED STATES v. MAHONEY

February 18, 1981

UNITED STATES of America
v.
James J. MAHONEY



The opinion of the court was delivered by: LORD, III

MEMORANDUM

Defendant has moved to dismiss the superseding indictment in this mail fraud case on the basis of claimed grand jury abuse. He is charged with thirty-eight counts of mail fraud, 18 U.S.C. § 1341; seven counts of making false statements to a federal agency, 18 U.S.C. §§ 1001 & 1002; and two counts of subscribing false tax returns, 26 U.S.C. § 7206(1). For the reasons which follow, I have denied the motion.

 Two grand juries heard evidence in this case. The first grand jury heard testimony and subpoenaed documents without returning an indictment. The second grand jury, impaneled June 29, 1979, returned the original indictment on October 5, 1979, and a superseding indictment on November 30, 1979.

 I. Summaries

 The first grand jury heard live testimony of twenty-seven witnesses. The second (indicting) grand jury had presented to it the following: (1) the live testimony in conventional question and answer form of two people, both of fairly minor importance; *fn1" (2) a third witness, Lloyd Brooker, appeared in person but simply read a summary of the statement he had given to the FBI; (3) the statements of twenty-one individuals presented by FBI Agent James Carlisle, who, for each person, summarized the person's testimony given before the first grand jury and/or any statements that he or she had given to FBI investigators. *fn2" Defendant argues that this method of presenting evidence to the grand jury, and the prosecutorial editing of evidence which it included, deprived him of his right to an unbiased grand jury.

 The Government stated that the summaries were used as a matter of economy. The United States Attorney estimated that presenting live testimony might have taken six months while, with the summary technique, the evidence was presented over three or four sessions within one month. The Government argues that the grand jury heard sufficient evidence to establish probable cause to indict the defendant, and thus the defendant was not prejudiced by this method of presenting the case to the grand jury.

 Defendant is accused of having used his position of Treasurer of the Council for Revitalization of Employment and Industry in Philadelphia (CREIP) to obtain kickbacks of money, services, and goods from contractors hired by CREIP to renovate the Wissahickon Industrial Center (WIC). His major complaint about the summaries is that all statements which exculpated him and many statements which impeached those persons who incriminated him were omitted. He stresses the omission of information relating to the independent motives of Lloyd Brooker, another CREIP employee, to obtain kickbacks and pad WIC bills. *fn3" The grand jury did have some access to this information since Brooker appeared in person before them, read a summary of his own statement, and was available for questioning. Grand Jury Transcript, Sept. 7, 1979, Testimony of Brooker. The defendant also argues that in one instance the testifying agent changed the meaning of the testimony of a witness. *fn4"

 The purpose of the grand jury is to determine probable cause to indict, not to determine guilt beyond a reasonable doubt. Defendant concedes that the grand jury heard enough evidence to find probable cause to indict him. Although total failure by a prosecutor to present substantial exculpatory evidence to a grand jury may constitute fundamental unfairness, *fn5" several courts have held that the grand jury is not required to hear exculpatory evidence as long as sufficient evidence is presented to establish probable cause to indict. See, e.g., United States v. Lasky, 600 F.2d 765 (9th Cir.), cert. denied, 444 U.S. 979, 100 S. Ct. 480, 62 L. Ed. 2d 405 (1979); United States v. Ruyle, 524 F.2d 1133 (6th Cir. 1975), cert. denied, 425 U.S. 934, 96 S. Ct. 1664, 48 L. Ed. 2d 175 (1976); United States v. Gardner, 516 F.2d 334 (7th Cir.), cert. denied, 423 U.S. 861, 96 S. Ct. 118, 46 L. Ed. 2d 89 (1975); United States v. Addonizio, 313 F. Supp. 486 (D.N.J.1970), aff'd, 451 F.2d 49 (3d Cir.), cert. denied, 405 U.S. 936, 92 S. Ct. 949, 30 L. Ed. 2d 812 (1972).

 It is constitutionally permissible for a grand jury to hear evidence that would be inadmissible at trial because of its hearsay character or because it was obtained in violation of the fourth amendment. United States v. Calandra, 414 U.S. 338, 94 S. Ct. 613, 38 L. Ed. 2d 561 (1974); Costello v. United States, 350 U.S. 359, 76 S. Ct. 406, 100 L. Ed. 397 (1956). Evidence presented to the grand jury is not subject to the same limits on admissibility as that presented at trial. Instead, the grand jury is to sift through all the evidence in order to determine independently whether probable cause exists to return an indictment or even whether a crime has been committed. Branzburg v. Hayes, 408 U.S. 665, 92 S. Ct. 2646, 33 L. Ed. 2d 626 (1972).

 Because of the great latitude allowed a grand jury in carrying out its work and the absence of admissibility limitations on evidence which it may hear, I do not think it is appropriate to establish a per se rule barring the use of summaries in grand jury presentations in all cases. I do not find that the specific summaries used here unfairly prejudiced the defendant.

 Defendant argues that the pattern of omissions of exculpatory evidence from the summaries and the misrepresentation of the testimony about the car constitute prosecutorial misconduct beyond "an isolated incident unmotivated by sinister ends." United States v. Serubo, 604 F.2d 807, 817 (3d Cir. 1979). Such serious misconduct may warrant dismissal of an indictment in the exercise of a court's supervisory powers even where abundant competent evidence supports the indictment. Id.

 The misconduct in Serubo was " "improper, reprehensible, and unacceptable.' " Id. at 814. It included questions, without any evidentiary foundation, about witnesses' knowledge of irrelevant and highly prejudicial murder threats. The misconduct alleged here does not compare in gravity. The reference to the car, see n. 4 supra, was the only actual "misstatement" out of twenty-one summaries.

 As noted above, the prosecutor in most cases has little or no obligation to present exculpatory evidence to the grand jury. Thus the omission of evidence about Brooker's and Watt's independent schemes, which possibly exculpated defendant in part, cannot be deemed a "flagrant abuse" of any prosecutorial responsibility. Id. at 817.

 Although I do not dismiss this indictment, I do note that the arguments against the use of summaries are powerful and have persuaded several courts to condemn the technique. See, e.g., United States v. Braniff Airways, Inc., 428 F. Supp. 579 (W.D.Tex.1977); *fn6" In re May 1972 San Antonio Grand Jury, 366 F. Supp. 522 (W.D.Tex.1973); In re Banana Industry, 214 F. Supp. 856 (D.Md.1963). Total reliance on the use of summaries for prosecutorial convenience is inconsistent with the historic purpose of the grand jury which is to function as an independent body of accusers, representative of the community, and to protect individuals from arbitrary and unfounded criminal prosecutions. Calandra, 414 U.S. at 343, 94 S. Ct. at 617. It is designed to stand as a shield between the cumulative might of the sovereign and the individual citizen. The use of summaries instead of available live witnesses undercuts this theoretical independence of the grand jury, the reality of which has ...


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