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Roy Langbord, et al v. United States Department of the Treasury

July 5, 2011

ROY LANGBORD, ET AL., PLAINTIFFS,
v.
UNITED STATES DEPARTMENT OF THE TREASURY, ET AL., DEFENDANTS.
UNITED STATES OF AMERICA,
THIRD-PARTY PLAINTIFF,
v.
TEN 1933 DOUBLE EAGLE GOLD PIECES, THIRD-PARTY DEFENDANT-IN-REM.



The opinion of the court was delivered by: Legrome D. Davis, J.

MEMORANDUM OPINION

I. BACKGROUND

In that the Court writes for the parties, who are well aware of the basic facts underlying the dispute, it need not again set out the full tale here, but rather incorporates the factual background found in previously issued memorandum opinions. (See Docs. No. 96, 108 & 131.) Suffice it to recount only this: In July 2009, the Court ordered that the Government initiate forfeiture proceedings against ten 1933 Double Eagles (the "Double Eagles," "Coins," or "Gold Pieces") that the Langbords had turned over to the Government so that they could be authenticated. (Doc. No. 108.) Two months later the United States sought leave to file a multi-count complaint (Doc. No. 111), which included the court-ordered forfeiture count against the Double Eagles.*fn1 Forfeiture is warranted, the Government argues, because the Double Eagles were embezzled or stolen from the United States Mint, and wrongfully retained by someone with knowledge that they were embezzled or stolen. See 18 U.S.C. § 641. On the eve of the forfeiture trial, the United States and Langbords challenge the admissibility of various evidence offered by the other side. This opinions resolves those evidentiary disputes to the extent they can be resolved prior to trial.

II. DISCUSSION

To better explain its evidentiary rulings and provide further guidance to the parties, the Court sets forth here the law and analysis underlying its decisions. The Opinion proceeds in logical steps: We first discuss the threshold question of authenticity, an area of some concern given the age and state of many proposed exhibits. It then moves on to determine which of the proposed exhibits are relevant, and weighs the probative value of the relevant documents against their potential prejudicial effect. Next, the Opinion tackles the hearsay questions raised by the parties, followed by a brief discussion of expert testimony. Finally, although the Court does not resolve the majority of jury-instruction issues in this Opinion, it does explain its ruling on the Langbords' motion for instructions related to the unconstitutional seizure of the Coins by the United States.

A. Authenticity

Federal Rule of Evidence 901 makes the "authentication or identification [a proposed exhibit] . . . a condition precedent to admissibility" and deems the requirement "satisfied by evidence sufficient to support a finding that the matter in question is what its proponent claims." Fed. R. Evid. 901(a). Importantly, the proponent need not conclusively prove that a piece of evidence is authentic; "[a]ll that is required is a foundation from which the fact-finder could legitimately infer that the evidence is what the proponent claims it to be." McQueeney v. Wilmington Trust Co., 779 F.2d 916, 928 (3d Cir. 1985) (internal quotation marks omitted). Thus, though authenticity is a condition precedent to admissibility, "[t]he burden of proof for authentication is slight." Id.

1. Ancient Documents

The majority of events giving rise to the United States's forfeiture claim occurred between 1933 and 1947. As such, the United States urges the Court to deem the large majority of its documentary evidence authentic under the Federal Rule of Evidence 901(b)(8), commonly known as the ancient document rule. The rule provides that a proponent meets its slight burden of proof so long as a document "(A) is in such condition as to create no suspicion concerning its authenticity, (B) was in a place where it, if authentic, would likely be, and (C) has been in existence 20 years or more at the time it is offered." Fed. R. Evid. 901(b)(8).

Under this rule, the United States seeks to introduce certified copies of documents it obtained from the United States Mint, the National Archives and Records Administration ("National Archives"), the Federal Reserve Bank of New York, the American Numismatic Society Library, Connecticut State Library, the Federal Bureau of Prisons, and the United States Department of the Treasury Library. (See Doc. 148.) The Langbords do not challenge the documents' age or that they were recovered from places where authentic documents would likely be. Rather, the Langbords contend that, with respect to many of the documents, the United States has not met its threshold burden of establishing that the documents' condition casts no suspicion on their authenticity.

The primary basis for the Langbords' objection is that the documents are neither signed by their authors nor, if letters, paired with signed letters to indicate they were ever sent or received. These fact, they contend, renders each of the unsigned documents too suspicious to qualify as prima facie authentic on its own, and must be accompanied by some extrinsic evidence in order to be deemed authentic as an ancient document.

The Court agrees that the available Third Circuit precedent suggests that importance of extrinsic evidence under certain circumstances, but finds sufficient evidence in the Government's proposed exhibits to conclude that the majority of the unsigned documents meet the authenticity threshold. Unlike more typical ancient documents, these documents, though unsigned, have been kept in the custody of the federal government, the State of Connecticut, or the American Numismatic Society library. The Langbords have cast no doubt on the ability of these institutions to keep records; nor have they "put forward so much as a hint that these documents have been tampered with in any way."*fn2 Parsons v. Celotex Corporation, C.A. No. CV 478--319, slip op. at 3 (S.D. Ga. Aug. 27, 1980) (quoted approvingly in Threadgill, 928 F.2d at 1376). Although a lone unsigned letter found by a layperson in a decedent's desk drawer might require some further extrinsic proof of authenticity, documents stored by governmental agencies with other documents of the same kind, discussing the same subject matter, and lacking any hint of suspicion qualify as prima facie authentic.

The Langbords' argument that many ancient documents in this case were prepared in anticipation of related criminal and civil forfeiture proceedings does not require a different conclusion.*fn3 While some courts have expressed that the ancient document rule makes sense because "such evidence is less likely to be affected by the forces generated by the litigation since they are made in a context where there is less reason to fear a lack of candor, distortion, whether conscious or unconscious, or even deliberate falsehood affected the statements made," Compton v. Davis Oil Co., 607 F. Supp. 1221, 1229 (D. Wyo. 1985), a broad policy underlying the rule need not apply to every document that meets the rule's delineated criteria. "Although the rule requires that the document be free of suspicion, that suspicion does not go to the content of the document but rather to whether the document is what it purports to be . . . ." United States v. Kairys, 782 F.2d 1374, 1379 (7th Cir. 1986) (cited approvingly in Threadgill, 928 F.2d at 1376). Whether the document's contents are trustworthy, accurate, or complete does not bear upon authenticity, but "upon the weight to be accorded the evidence." Kairys, 782 F.2d at 1379. Requiring courts to ignore the ancient document rule's three requirements and make determinations based on whether a document was prepared with similar litigation in mind would require courts to assess a document's trustworthiness or bias, a task inappropriate when resolving threshold authenticity questions.

But though the majority of the documents meet all three requirements of the ancient document rule, a hint of uncertainty does appear in a few of the Government's proposed exhibits. Perhaps because of the documents' age, many of the records seem to have been "copied" manually. The Langbords complain especially of two manually transcribed potential copies of a 1933 telegram (United States's Proposed Exhs. 134 & 266) and an alleged copy of a statement that the Government attributes to Israel Switt, but which does not bear his signature (United States's Proposed Ex. 239). In addition, the many unsigned documents bearing the word "COPY" or marked as signed either with type-written letters or a stamped image bear similar indicia of uncertainty.*fn4 As the Third Circuit has explained, "the point of a Rule 901(b)(8) inquiry is to determine whether the documents in question are, in fact, what they appear to be." Threadgill v. Armstrong World Industries, Inc., 928 F.2d 1366, 1376 (3d Cir. 1991). Thus, when an indication that the document has been recreated manually appears on the face of the document, the Langbords challenge that the United States has not put forth any evidence to establish that these documents are what the Government asserts they appear to be: accurate reproductions of missing originals.

In order to attribute the contents of these unsigned manual copies to their supposed authors-e.g., demonstrate that a manually reproduced document should be treated as if it were the 1933 telegram itself-the Government must establish that the copies are accurate reproductions of originals. In all but a few instances (where, for example, a signed copy also appears among the proposed exhibits), they have not produced sufficient extrinsic evidence to overcome the marks of uncertainty that appear on the documents' faces, and thus they have not established prima facie authenticity of the documents as accurate copies of originals. But the marks suggesting that the documents were manually created does not prevent the United States from introducing them; they just must do so under slightly different terms. Although the United States has not provided sufficient evidence to suggest that the manual copies accurately reflect originals-and are, therefore, the originals' equivalents-they have established that these documents were manually created more than 20 years ago and now comprise part of archival government files related to the 1933 Double Eagle. Defined in this way, the documents qualify as prima facie authentic. Whether the contents of the documents are accurate-that is, whether they actually reflect now missing originals such that the contents can be attributed to the document's supposed author-is a separate question that the parties may contest before the jury.

2. Government's Challenges to Langbords' Proposed Exhibits' Authenticity The Government challenges the authenticity of the majority of the Langbords' proposed exhibits on the grounds that the Langbords have not provide proof of authenticity. The Langbords respond that they have provided the Government with record custodian certificates for 52 of those exhibits. To the extent that the certificates appear authentic at trial, the Court will deem the documents prima facie authentic under Rule 902(11) (business record must be "accompanied by a written declaration of its custodian"). (See Langbord Proposed Exs. 8, 10--23, 25--29, 31--44, and 46--63.) Eight more of the proposed exhibits appear to be self- authenticating official publications or periodicals covered by Rule 902(5) and (6). ( See Langbord Proposed Exs. 2, 3, 64--67, and 150.) The three photographs taken by the Langbords' counsel's paralegal might properly be authenticated through her testimony under Rule 901(b)(1). (See Langbord Proposed Exs. 45, 68, 69.) If the Government will not stipulate to the authenticity of those documents the Langbords state they received from the Government, the Langbords can either obtain the appropriate certifications or limit their use to cross-examination purposes as they suggest.

B. Relevance and Prejudice

This section of the Court's Memorandum Opinion explains its evidentiary rulings premised upon Federal Rules of Evidence 401, 402, 403, and 404. Rule 402 provides that "[a]ll relevant evidence is admissible"; Rule 401 defines relevant evidence as evidence having "any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." A piece of relevant evidence might be deemed inadmissible nonetheless if its "probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury." Fed. R. Evid. 403. Finally, Rule 404(b) states that "[e]vidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show action in conformity therewith," but that evidence of bad acts offered for any other purpose that also meets Rule 403's balancing test can be admitted. In conducting this Rule 404(b) analysis, the court "must balance the actual need for that evidence in view of the contested issues and other evidence available to the [proponent]." United States v. Sriyuth, 98 F.3d 739, 748 (3d Cir. 1996); United States v. Scarfo, 850 F.2d 1015, 1019 (3d Cir. 1988) (same). With these rules in mind, the Court addresses the categories of proposed exhibits to which the Langbords raised an objection, followed by the categories to which the Government raised an objection.

1. Barnard Decision

Contained within the United States's proposed exhibits are documents related to United States v. L. G. Barnard, a 1947 case in the Western District of Tennessee. There, the United States sought replevy of one 1933 Double Eagle from collector L. G. Barnard. Judge Boyd made factual findings that the Philadelphia Mint had "not receive[d] a license from the Secretary of the Treasury" to issue any 1933 Double Eagles, that "[t]he weight of the bullion resulting from the melting of all 1933 Double Eagles held by the Philadelphia Mint was the same as the weight of the coin prior thereto," and therefore that the 1933 Double Eagle at issue "was taken from the Philadelphia Mint illegally, upon substitution of a Double Eagle of another year, so that its loss would not be detected in weighing." (Gov't Proposed Ex. 1-A at 2-3.)

The Langbords object to the introduction of Judge Boyd's factual findings and legal opinion on the grounds that no exception to the hearsay rule provides for the introduction of judicial opinions or factual findings.*fn5 (Doc. No. 153 at 28.) The Government responds that these documents are not, in fact, hearsay because it does not intend to introduce them for the truth of the matter; the Government instead asserts "they are set forth to show that Israel Switt, and any other purchaser or holder of 1933 Double Eagles subsequent to the Barnard decision, was on notice that the government alleged the property was stolen." (Doc. No. 162, at 21-22.) The Langbords label this strategy a ruse because the Government fails to provide any evidence that Switt knew about the Barnard decision-in fact, the Langbords claim, the case's publicity was limited to a brief July 1947 New York Times article appearing on page 23 with more than myriad short news stories and obituaries and a 1948 Numismatist paragraph-long story on page 50. Thus, the argument goes, "there is no evidence, and no reasonable basis for a jury to conclude, that Israel Switt or his heirs-all of whom were living in Philadelphia when the articles were published-actually saw either of these minor stories," and the Government should not be allowed to introduce the Barnard decision for the purposes of proving notice.

If the Government seeks to introduce the Barnard findings of fact and judicial opinion for their truth, the Court finds no hearsay issue with the documents-like many of the United States's proposed exhibits, the documents were created more than 20 years ago, are in conditions that create no suspicion concerning their authenticity, and were found in the National Archives collection in Georgia, qualifying them as an ancient document under Rule 901(b)(8) and therefore as a "statements in ancient documents" for hearsay purposes pursuant to Rule 803(16).

But this conclusion does not end the admissibility inquiry. Rule 403 requires courts to balance the probative value of a particular piece of relevant evidence against any undue prejudice that the evidence might spark and to exclude the evidence if the undue prejudice substantially outweighs the probative value. Fed. R. Evid. 403. Judicial findings of fact or conclusions of law pose a serious risk to the fairness of the judicial process because "they would likely be given undue weight by the jury" and "creat[e] a serious danger of unfair prejudice." Zenith Radio Corp. v. Matsushita Elec. Indus. Co., Ltd., 505 F. Supp. 1125, 1186 (E.D. Pa. 1980). Beyond that, introducing legal conclusions made sixty-four years ago by a judge who considered different evidence might muddle the issues in the present case and require a forceful instruction about the relationship, or lack thereof, between that case and this one. See id. Because the United States seems to possess nearly all of the evidence that Judge Boyd considered in 1947 and those documents are admissible as ancient documents, the absence of necessity for this evidence tips the closely balanced scale against its admission as stand-alone substantive evidence.

Turning back to the United States's proposed resolution-to admit the Barnard opinion and factual findings for notice purposes only-the Court concludes that, despite the lack of direct evidence that Switt or his relatives ever learned of the Barnard decision, the decision's existence has a tendency to make Switt's or his relatives' notice of the potential illegality of possessing 1933 Double Eagles at least somewhat more probable, such that the Barnard documents meets Rule 401's relevancy threshold. A plethora of proposed admissible evidence demonstrates the extent of Switt's dealing in gold coins and his questioning by the Secret Service about 1933 Double Eagles. A fair inference may be drawn that, although an average Philadelphian may not have received notice of the Barnard decision, Switt, with as much to gain or lose from it as anyone, would have been made aware of it through one channel or another.

That said, based on the Rule 403 analysis performed above, introducing the Barnard factual findings and opinion for purposes other than to demonstrate notice, or extensively recounting the factual or legal conclusions that Judge Boyd drew, would subject the Langbords to undue prejudice.

Finally, the Court is mindful that David Tripp and Eric Rauchway, the United States's experts, relied upon these documents for their truth, and not their notice potential. Rule 703 governs the disclosure of evidence relied upon by experts and prohibits experts from discussing otherwise inadmissible evidence unless the Court "determines that [the evidence's] probative value in assisting the jury to evaluate the expert's opinion substantially outweighs [its] prejudicial effect." Here, the Barnard opinion and factual findings are historical accounts that Tripp and Rauchway used, along with other historical documents and accounts, to reach the conclusion that the 1933 Double Eagles were stolen. The factual findings and legal conclusion are of the type of historical evidence which experts typically rely upon in reaching expert opinions. Because the weight of the historical evidence supporting the conclusion that the Coins were stolen, balanced against the dearth suggesting the Coins left the Mint through authorized channels, undergirds both expert opinions, Tripp and Rauchway may refer to the documents during their testimony, and they will be admitted as exhibits. They may not, however, stress that in a legal action similar to the instant dispute, a judge made a determination favorable to the government upon consideration of substantially similar evidence. The Court will give the jury a cautionary instruction to ensure that the jury does not place undue weight on Judge Boyd's legal opinion and counsel is requested to promptly submit a proposed instruction on this point.

2. 1934 Switt Gold Hoarding Case

The United States seeks admission of documents related to a second case: United States v. 98 Twenty Dollar United States Gold Coins lately in the possession of Israel W. Switt (hereinafter "Switt case"), wherein the Government sought and obtained forfeiture of coins seized from Switt's person in 1934 because, in possessing them, he violated the Gold Reserve Act of 1934.*fn6 The Langbords claim that the Switt case documents are irrelevant, highly prejudicial, and laden with hearsay. The Court addresses the hearsay argument later in this Order but here concludes that the documents appropriately go to Switt's knowledge ...


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