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UNITED STATES v. FISCHBACH & MOORE

December 21, 1983

UNITED STATES OF AMERICA, Plaintiff,
v.
FISCHBACH AND MOORE, INCORPORATED, THE HOWARD P. FOLEY COMPANY, LORD ELECTRIC COMPANY, INC., SARGENT ELECTRIC COMPANY, E.C. ERNST, INC., TRI-CITY ELECTRIC COMPANY, INC., JOSEPH J. RODGERS, PAUL E. ARBOGAST, FREDERIC B. SARGENT, RALPH D. VRYENHOEK, and JAMES L. OESTERLE, Defendants



The opinion of the court was delivered by: COHILL

 The defendants in this case were indicted by a federal grand jury and charged with criminal violations of Section 1 of the Sherman Act, 15 U.S.C. § 1. The government allegations charge defendants with conspiracy and bid rigging in connection with electrical contracting work done for United States Steel at its "Western Pennsylvania Works" from 1974 to 1981. *fn1" Specifically, the government claims that defendants formed a continuing agreement by which they allocated electrical construction projects among themselves, fixed the prices at which these projects were bid, and submitted noncompetitive, collusive bids, or refrained from bidding with relation to the construction projects. The defendants were involved in bidding on over 150 projects during this period.

 Before the Court are a number of joint discovery motions made by defendants: 1) Motion for a Bill of Particulars; 2) Motion for Disclosure Regarding Alleged Prior Misconduct or Conviction; 3) Motion to Compel Discovery; 4) Motion for Disclosure of Matters Occurring Before the Grand Jury; 5) Motion to Strike Surplusage; and 6) Motion to Disclose Electronic Surveillance.

 I. Defendants' Motion for a Bill of Particulars

 Defendants have moved, pursuant to Rule 7(f) of the Federal Rules of Criminal Procedure for a bill of particulars. In support of this motion, defendants argue that they need more information to 1) prepare their defenses, and 2) ascertain whether they may be prosecuted a second time in the future for the offenses presently charged. The defendants claim that the conspiracy alleged by the government covers a seven-year period and over 150 projects, but that the counts of the indictment are so general that defendants are unable to ascertain which projects the government asserts were the subjects of the conspiracy, when the actions took place, or who was involved.

 The government, in opposition to this motion, argues that defendants are not entitled to a script of the government's case; that the case is a simple one involving bid rigging; that defendants have received the grand jury testimony of 28 witnesses and numerous documents and exhibits, and that defendants have access to all information necessary to prepare their defenses. The government has also claimed that all jobs bid for during this period are covered by the indictment as subjects of the conspiracy, and that the question of which particular jobs are involved is not relevant.

 The defendants are entitled to more information as to the conspiracy and actions with which they are charged; we will therefore grant defendants' motion in part and deny it in part.

 We note at the outset that the granting of a bill of particulars is a matter within the discretion of the trial court. Wong Tai v. United States, 273 U.S. 77, 82, 71 L. Ed. 545, 47 S. Ct. 300 (1927), United States v. Armocida, 515 F.2d 49, 54 (3d Cir.), cert. denied, 423 U.S. 858, 46 L. Ed. 2d 84, 96 S. Ct. 111 (1975). The purpose of a bill of particulars is to inform the (defendants) of the nature of the charges brought against him to adequately prepare his defense, to avoid surprise at trial, and to protect against a second prosecution for an inadequately described offense. United States v. Addonizio, 451 F.2d 49, 63-64 (3d Cir. 1971), cert. denied, 405 U.S. 936, 30 L. Ed. 2d 812, 92 S. Ct. 949 (1972). See also, Will v. United States, 389 U.S. 90, 99, 19 L. Ed. 2d 305, 88 S. Ct. 269 (1967); United States v. Davis, 582 F.2d 947, 951 (5th Cir. 1978), cert. denied, 441 U.S. 962, 60 L. Ed. 2d 1067, 99 S. Ct. 2408 (1979).

 The government has already provided defendants with "relevant portions" of the grand jury testimony of twenty-eight witnesses, relevant grand jury exhibits from related District of Columbia grand jury proceedings, relevant exhibits from the Pittsburgh grand jury proceedings, relevant documents subpoenaed in connection with these proceedings, and documents voluntarily produced to the government. The government has also stated that it will provide to defendants a list of unindicted co-conspirators, as well as transcripts of relevant grand jury testimony of employees within the definition of Fed. R. Crim. P. 16(a)(1)(A).

 A significant amount of information has already been made available to defendants. An indictment under the Sherman Act is not required to be detailed or evidentiary in nature, since the basis of a conspiracy charge is "agreement rather than action, and the agreement is usually established by a course of dealing or pattern of conduct and the reasonable inferences to be drawn therefrom." United States v. Tedesco, 441 F. Supp. 1336, 1340 (M.D. Pa. 1977) (citing United States v. United States Steel Corp., 233 F. Supp. 148, 152 (S.D.N.Y. 1964)). Thus, overt acts need not be alleged in a Sherman Act conspiracy indictment, since the conspiracy itself is the nature of the crime. Nash v. United States, 229 U.S. 373, 57 L. Ed. 1232, 33 S. Ct. 780 (1913).

 In Russell v. United States, 369 U.S. 749, 82 S. Ct. 1038, 8 L. Ed. 2d 240 (1962), the Supreme Court held that a legally sufficient indictment must state the elements of the offense charged with sufficient clarity to apprise the defendant of what he must defend against and accurately record the crime for which the individual may be convicted or acquitted to avoid a second jeopardy of the same offense. Id. at 763-64, 82 S. Ct. at 1046-47.

 Having considered this standard, the arguments of counsel, the indictment itself, and the information already in defendants' possession as well as what the government has promised to supply, we remain concerned with the number of projects bid on over the seven-year period during which the conspiracy allegedly took place. The "Western Pennsylvania Works" (as noted in footnote 1 hereof) comprises a number of plants. Some 150 contracts were bid on. We do not believe that it will unreasonably limit the government's case to require identification of which contracts are alleged to be the subject of the conspiracy to allocate bids among defendants, having bid prices fixed, or for which noncompetitive, collusive and rigged bids were submitted, and/or on which defendants and co-conspirators refrained from bidding pursuant to the alleged conspiracy. (Defendants' Motion for Bill of Particulars, para. 6(b)). Disclosure of this information should be sufficient to allow defendants to prepare for trial without "freezing" the government's proof. We will, therefore, grant para. 6(b) of the defendants' Motion for a Bill of Particulars, and deny the other requests included in that Motion.

 II. Defendants' Joint Motion to Compel Discovery

 1) Statements of Defendants.

 Defendants have moved for a) written or recorded statements of past or present employees of the corporate defendants including verbatim notes of interviews conducted by government representatives; b) transcripts of the grand jury testimony of past or present employees; c) the substance of oral statements by any past or present employee which the government intends to offer into evidence at trial; d) transcripts of grand jury testimony and/or written or recorded statements of any alleged co-conspirators of the defendants; and 3) any written or recorded statements of any individual defendant. With respect to b), defendants claim that the government has given them access to only a portion of many grand jury transcripts of past and present employees, including the testimony of what defendants claim to be seven critical witnesses. Defendants claim that the government has impermissibly redacted transcripts of the testimony of other present or past employees.

 Pursuant to defendants' motion, the government has responded by agreeing to supply to the appropriate corporate defendants the relevant grand jury testimony of those present or past employees who were in a position to bind the corporation regarding conduct constituting the offense, which testimony falls within the description of Fed. R. Crim. P. 16(a)(1)(A). Defendants have also referred to certain witnesses, present and former employees of various defendants, who testified before the grand jury and whose grand jury transcripts have not yet been produced by the government. They are: Donald Paul, Cal Walker, Clayton Shackleford, James Shannon, Richard Perrott, and Paul Hatton. Defendants are entitled to the relevant portions of these transcripts pursuant to Rule 16(a)(1)(A), and the government will be ordered to produce these portions forthwith. The government has already provided a copy of the grand jury testimony of the only individual defendant who made a statement to the government. Statements made to third parties and not falling within the appropriate limiting definition in Rule 16(a)(1)(A) are not discoverable. United States v. Heldon, 479 F. Supp. 316, 322-23 (E.D. Pa. 1979). We will deny defendants' motion to compel production of any verbatim notes of interviews conducted by government representatives, unless those notes, pursuant to Fed. R. Crim. P. 16(a)(1)(A), constitute the substance of oral statements of a defendant which the government intends to offer into evidence at trial, which statement was given in response to interrogation by a person then known by the defendant to be a government agent.

 Defendants have also moved to require production of grand jury testimony and/or the written or recorded statements of any alleged co-conspirators. While some courts have read the mandate of Rule 16 broadly, see United States v. Thevis, 84 F.R.D. 47, 55-56 (N.D. Ga. 1979), United States v. Agnello, 367 F. Supp. 444, 448 (E.D.N.Y. 1973), we are of the view that these are statements within the reading of the Jencks Act, 18 U.S.C. § 3500, and not within the purview of Rule 16. See United States v. Callahan, 534 F.2d 763 (7th Cir.), cert. denied, 429 U.S. 830, 50 L. Ed. 2d 94, 97 S. Ct. 91 (1976); United States v. Kenny, 462 F.2d 1205, 1212 (3d Cir.), cert. denied, 409 U.S. 914, 34 L. Ed. 2d 176, 93 S. Ct. 233 (1972); United States v. Wolczik, 480 F. Supp. 1205, 1209 (W.D. Pa. 1979). See also United States v. Walk, 533 F.2d 417 (9th Cir. 1975); United States v. Feinberg, 502 F.2d 1180 (7th Cir. 1974), cert. denied, 420 U.S. 926, 43 L. Ed. 2d 396, 95 S. Ct. 1122 (1975); United States v. Wilkerson, 456 F.2d 57 (6th Cir.), cert. denied, 408 U.S. 926, 33 L. Ed. 2d 337, 92 S. Ct. 2507 (1972).

 Pursuant to Fed. R. Crim. P. 16(a)(1)(C), defendants have moved to compel production of documents, books, papers, photographs or tangible objects material to the preparation of the defense or intended for use by the government as evidence-in-chief at trial. Defendants have also moved for production of documents produced to the grand jury or voluntarily to government attorneys in the course of investigations leading to the indictment which are relevant to the matters charged in the indictment. First, defendants refer to certain file drawers from which defendants' attorneys were barred. These drawers clearly should be examined by the government for any documents material to the preparation of the defense or intended for use in the government's case-in-chief, and material subject to the Rule should be produced. If, as the government asserts, these drawers contain files relating to other grand jury investigations, defendants, of course, have no right of access to these documents. Finally, the government has indicated that it will produce for defendants' inspection documents relating to the financial and compensation records of Meade Electric Co., subject to Meade's right to move for a protective order.

 Defendants have also objected to production by the government of an allegedly voluminous quantity of documents relating to construction bids for work at U.S. Steel, in connection with that section of Rule 16(a)(1)(C) requiring production of documents intended by the government to be used as evidence in its case-in-chief. Insofar as defendants request designation of exhibits by the government, we find no case law supporting this particular request. We find the case of United States v. Sanders, 266 F. Supp. 615 (W.D. La. 1967) inapposite. It considered the appropriate remedy when a United States Attorney discovered one week before trial that not all 16(a)(1)(C) material had been turned over to defense counsel. That case nowhere indicates that the government must produce designated exhibits in advance of trial. Moreover, not only are defendants familiar with their own firm files, but we believe that the identification by the government of specific contracts it alleges were involved in the bid rigging will sufficiently aid the defendants in culling significant documents. The government has satisfied its obligation of production under Rule 16(a)(1)(C). United States v. Litman, 547 F. Supp. 645, 652 (W.D. Pa. 1982).

 3) Reports of Examinations and Trials

 Defendants have moved for production, pursuant to Rule 16(a)(1)(C) and (D) for any results or reports of any analysis or study made or used by an economist or statistician concerning bidding, bidding practices or pricing in connection with this case. We do not believe that economists' reports are the type of material to be disclosed pursuant to Rule 16, nor have ...


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