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UNITED STATES v. MCNAUGHTON

April 4, 1994

UNITED STATES OF AMERICA
v.
RICHARD MCNAUGHTON



The opinion of the court was delivered by: ANITA B. BRODY

 Anita B. Brody, J

 Richard McNaughton is one of eighteen defendants named in a ninety-seven count indictment that alleges the existence of a conspiracy to evade state and federal excise taxes on the sale of diesel oil. The issue before me is whether to suppress statements McNaughton made to federal agents during interviews on November 24, and December 1, 1992. In arriving at my decision I must decide:

 
1. Whether a suspect is "in custody" when he is interviewed alone by government agents but is not handcuffed, patted down, placed under arrest, or otherwise physically restrained, and is permitted to receive telephone calls and to leave to speak with an attorney when he asks to do so. I hold that he is not.
 
2. Whether statements made in response to a government agent's invitation to cooperate, but in the absence of any promises of leniency or confidentiality, are inadmissible as involuntary. I hold that such statements are voluntary and admissible.
 
3. Whether statements made in response to an agent's invitation to cooperate, but in the absence of any promises or discussions of reduced charges or specific sentences, are inadmissible as having been made in the course of plea negotiations. I hold that such statements are not suppressible on that basis.
 
4. Whether a defendant, who in his capacity as a corporate officer was represented by the company's corporate attorney, may obtain suppression of statements he made to a government agent who spoke to the defendant himself rather than to the company's attorney. I hold that the statements should not be suppressed. In deciding this I must determine:
 
(a) if a government agent is subject to the anti-communication rule to the same extent as the government's attorney. I find that he is.
 
(b) if representation by the corporate attorney is representation of the defendant in his individual capacity. I find that it is not.
 
(c) if a defendant is entitled to invoke the protection of the anti-communication rule in this circumstance. I find that he is not.
 
(d) if I were to find that the attorney-client relationship had been violated, whether suppression is an appropriate remedy for an ethics violation. I find that it is not.

 FINDINGS OF FACT

 As to statements made November 24, 1992:

 1. Defendant McNaughton is the Manager of Wholesale Fuel Sales for Atlantic Oil and Heat ("Atlantic") and the president of Bell Fuels, Inc., trading as ASCO, Inc. McNaughton holds no ownership interest in either company.

 2. On November 24, 1992, a search warrant was executed at the offices of Atlantic, located in Macungie, Pennsylvania. The search began at approximately 9:00 a.m. and continued until approximately 7:00 p.m.

 3. Two agents, FBI Agent William Sinopole and IRS Agent William Ranmal, entered the offices of Atlantic through the main entrance at approximately 9:00 a.m. Agent Sinopole announced in a loud voice that everyone was to stop work and leave their work stations, that the agents were there to execute a search warrant and that the employees were free to stay or go, as long as they did not work or interfere with the search, but that the agents wanted to identify people before they left. After this announcement the remaining agents entered the building.

 4. Nineteen agents of the Federal Bureau of Investigation ("FBI), Internal Revenue Service ("IRS") and Pennsylvania Department of Revenue, Bureau of Motor Fuel Taxes conducted the search. They were assisted later in the day by five additional IRS agents. The agents were armed and were wearing "raid" jackets (nylon windbreaker jackets saying FBI, CID or POLICE across the back). The agents did not draw their guns at any time during the search.

 5. Approximately twenty-eight employees of Atlantic, including McNaughton, were on the premises when the search of Atlantic began.

 6. McNaughton was interviewed by FBI Agent Ralph Hilborn and John Brennan, a Pennsylvania Revenue Enforcement Officer, in his office during the execution of the search warrant. McNaughton was not placed under arrest, patted down, handcuffed, or otherwise physically restrained. McNaughton was free to leave at all times.

 7. Agent Hilborn advised McNaughton that the agents were there to execute a search warrant, told him what records they were searching for, and asked for his cooperation in locating any records within his office.

 8. Agent Hilborn also explained to McNaughton that there was a significant amount of evidence against him, that it was likely that he was going to be prosecuted, that cooperation can be considered by the court at the time of sentencing under the Sentencing Guidelines, asked for his cooperation, and asked to interview him. He did not advise McNaughton of his Miranda rights.

 9. Richard McNaughton agreed to be interviewed on November 24, 1992. The interview lasted from approximately 9:05 a.m. to 10:36 a.m.

 10. At some point during the interview Agent Hilborn or Agent Brennan pushed the door of McNaughton's office closed or nearly closed; the agent took no action to lock the door. When shut, the door automatically locked so that no one could enter the office, although people in the office could still leave.

 11. Agent Hilborn did not tell McNaughton that the interview would be "off the record", nor did he made any promises to Richard McNaughton regarding charges or sentencing. In fact, Hilborn specifically told McNaughton that he was not authorized to make promises of any kind to him.

 12. Hilborn and McNaughton did not discuss the possibility of a guilty plea.

 13. During the interview, McNaughton did not try to use the telephone to make any calls, nor did he ask the agents if he could do so. McNaughton received several calls during the interview. The agents asked some of the callers to call back at a later time; McNaughton spoke to other callers.

 14. During the interview Agent Hilborn told McNaughton that Agent Perry would also like to interview him and would ...


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