September/October 2006, Page 16

Queen for a Day From Hell: How to Handle a Troubling Proffer Letter
By Jon May

You get a call from a friend of yours, a corporate lawyer at Silk, Stockings, Blue, Blood & Goldberg. One of the firm’s major clients has received a target letter and they are in a panic. She asks if you are free to meet with their client later that day. When you meet with the client, Rogers, at SSBB&G, this is what you learn.

Rogers is 65 years old. He is a graduate of Georgia Tech and has a degree in engineering and an MBA from Duke. He has a wife, three children, four grandchildren, and his company, International Pumps (IP), has 400 employees. IP manufactures industrial pumps used to remove water and other kinds of liquids resulting from floods and environmental spills. His company sells this equipment to businesses and governments around the world. Rogers has never been in trouble. He claims to have absolutely no idea why he is under investigation.

You call the United States Attorney’s Office and speak to the Assistant handling the case. The prosecutor tells you that your client and his company have bribed officials in El Dorado and that the client is looking at an indictment for violation of the Foreign Corrupt Practices Act. The prosecutor volunteers that they have already made deals with a number of IP employees, but that of course, if Rogers wants to come in and speak to them, they would be happy to listen to anything he has say. You respond that you will talk to your client and you ask the prosecutor to fax over a “Queen For A Day” letter.

The next day, you meet with Rogers and your colleague at SSBB&G. Rogers tells you that IP has a contract with the Republic of El Dorado to provide pumps for use in disaster relief. The country is regularly flooded during hurricane season. When told that the government believes that he bribed government officials to get the contract and that the government claims to have employee witnesses, Rogers responds that the allegations are bald-faced lies. After he settles down, he reveals that in order to do business in El Dorado, IP had to hire local lobbyists, but says any business operating in El Dorado had to do the same. Everyone knew about it, even the U.S. Embassy. He was unaware of any money going to any government official.

That afternoon you receive the proffer letter from the prosecutor. When you read it, you nearly fall out of your chair. In addition to the usual language agreeing that the government can use anything the client says to impeach him should he testify, you also see the following: “The defendant’s statements may also be used to rebut any evidence or arguments offered by or on behalf of the defendant (including arguments made or issues raised sua sponte by the district judge).” Does this mean that if you make an opening statement challenging the government’s case your client’s statements come in? Does this preclude you from cross-examining the government’s witnesses? What if the judge asks a question you deliberately did not ask because you feared opening the door to the defendant’s proffered statements? This cannot be right, you tell yourself. Two hours later, having read the Seventh Circuit’s decision in United States v. Krilich,1 the Second Circuit’s decision in United States v. Velez,2 as well as Barry Tarlow’s column in The Champion, Queen for a Day – Proffer Your Life Away,3 you realize you are in deep and troubling waters.

Based on your preliminary investigation you believe your client has a defensible position. It is not illegal to hire lobbyists to assist in obtaining a contract from a foreign government as long as the lobbyist is not a conduit for funds to a public official. But these lobbyists were paid over a million dollars for their assistance and you do not know what the government’s witnesses are going to say. Assuming there is nothing in writing that would demonstrate actual knowledge (an assumption that you know from experience may turn out not to be true), and knowing that there is no witness you cannot destroy on cross, you realize that the government could nevertheless prevail on a theory of deliberate ignorance. The dilemma you face is that anything your client would say in his defense also enhances the government’s case for conscious avoidance.

Your client wants to speak to the prosecutor. He is convinced that if the prosecutor hears his side of the story, the prosecutor will realize the terrible mistake she has made. You explain that the conditions being demanded by the government could virtually prevent you from defending him at trial. He says he does not care, and that he could not survive even an indictment. The client asks you to try to negotiate better ground rules, but makes it clear that ultimately he will speak to the prosecutor no matter what the conditions.

Approaches to the Solution
You have a number of options. But with one exception, each has its dangers. If the prosecution initiated contact with your client and wants to interview him, you have a great deal more leverage. In that case you can insist on use immunity under 18 U.S.C. § 6002. Such immunity not only prevents the government from using you client’s statement against him, it also prevents the government from using any evidence that is uncovered as a result of the statement provided by your client. Prosecutors often balk at giving such immunity because it requires approval from the Department of Justice. They will argue that if your client did nothing wrong, he has nothing to fear. They may even suggest that if your client insists on full § 6002 immunity, his status as a witness could change.

You can eliminate the objection about DOJ approval by offering to agree to a letter granting use and fruits immunity. The disadvantage to such informal grants of immunity is that they are generally not binding on other jurisdictions. But they offer far greater protection than the traditional Queen for a Day (QFAD) agreement, and if faced with a choice between insisting on formal § 6002 immunity or agreeing to the “Queen for a Day from Hell” letter sent by the prosecutor, insist on the former.

Witnesses speak to prosecutors and agents every day without any form of immunity. Your client may be one of those who can speak freely without worry. This is an easy case. Ironically, an even easier situation is presented where the government has so much evidence against your client that his own statement is the least of his worries. In such cases you are going to be more concerned about working out a cooperation agreement.

Advising the client becomes treacherous when it appears that the client has a defense but the consequences of losing at trial are devastating. Pleading may not be a very palatable option either. Despite United States v. Booker,4 the Sentencing Guidelines are still the driving force in sentencings. Indeed, the most current research demonstrates that the courts are imposing even greater sentences after Booker. In order for your client to avoid such harsh consequences, you must either convince the government that your client is innocent or has something significant to offer.

Presented with such a situation, you might want to consider doing the following:

First. Insist on strict use immunity, with the only exception being that if the client testifies, the government can cross-examine him with any statement that is inconsistent with his testimony. Depending upon the district, that may be the standard agreement anyway.

Second. Flat out refuse to agree to a Queen for a Day from Hell (QFADFH) proffer. It has been reported that the Department of Justice is taking the position that it will only agree to a proffer containing the Queen for a Day from Hell language. QFADFH proffers are popping up everywhere and have been reportedly seen in Minnesota, New York, Tennessee, Missouri, Kansas, Oregon, Arizona, the Southern District of Illinois, the Southern District of Florida, and the Eastern District of North Carolina.

But party lines are just that. Frederick Goezt5 of Minneapolis has reported success in convincing prosecutors to remove the offending language. If, as in the hypothetical above, the prosecutor is interested in what Rogers can tell the government about other companies who have hired lobbyists in El Dorado, the prosecutor may be willing to stop using office policy as an excuse. The fact is, someone in the United States Attorneys Office has the authority to waive just about any policy, and nothing stops you from insisting that the line assistant speak to her superiors.

Third. If the prosecutor refuses to change their standard language, tell her that your client can speak to them pursuant to Rule 11 of the Federal Rules of Criminal Procedure. Rule 11 governs pleas, and pursuant to Rule 410(4) of the Federal Rules of Evidence “any statement made in the course of plea discussions with an attorney for the prosecuting authority which do not result in a plea of guilty or which result in a plea of guilty later withdrawn” is not, in any criminal proceeding, admissible against the defendant who made the plea or was a participant in the plea discussions. David Weber of Anchorage has reported success in convincing prosecutors to just go by the rules. This may offer even greater protection than the traditional QFAD language since it does not permit the use of a defendant’s statement even on cross.

Prosecutors know all of this and may not agree to sit down with your client under such circumstances. They may, however, agree to sit down with you for a more extended discussion. Although this may simply put off a decision whether to have your client speak to the prosecutor directly, it may provide information you need for the client to make an informed decision.

There is another danger as well. Even if your informal chat with the prosecutor leads to a sit down with the government, as Thomas Farrell of Pittsburgh has pointed out, some courts have taken a position that an effort to convince a prosecutor that she has made a mistake in charging your client may not be considered to be plea bargaining at all and thus not protected by Rule 11.6 And since this is an issue that can only be determined by a court at an evidentiary hearing — long after your client has spoken to the prosecutor — your client is forced to jump off the high board not knowing if there is any water in the pool.

By far the worst situation is for a client to go into a proffer session and convince the prosecutor that she is lying. Just ask Martha Stewart. To use an example offered by Larry Goldman of New York, if you client admits that she possessed stolen property but maintains that she did not know it was stolen, you might want to know that the government’s witnesses claim that they told your client that they knocked over a jewelry store or sold her the goods for a price that was a lot less than wholesale value. If your client tells the prosecutor that she possessed the property but did not know the property was stolen, the prosecutor will kick you and your client out of his office and your client’s admission that she possessed the property will become evidence that would be admissible at trial. If you make the same claim, that this is what she might say, at least you have not harmed your client. And you can advise her that if she decides to speak to the prosecutor about possessing the property, she better be prepared to admit her knowledge too. Thus, a face-to-face meeting with the prosecutor will almost always provide you with a better chance of convincing the prosecutor that your client can be of assistance in this or some other case. The longer the discussion, the more likely it is that you will learn what the government is looking for.

Another tactic, used successfully by Max Kravitz of Columbus, Ohio, is to have the client talk to the prosecutor without any agreement at all. If you decide that you have to put your client in the cross-hairs, this is preferable to a proffer pursuant to a Queen for a Day from Hell agreement. It offers no less protection and has the virtue of putting your client in the position of being able to say to the jury that he spoke to the government voluntarily, without any protection, and had nothing to fear from the truth. Obviously, this is a high stakes gamble. But in the right case it may be worth the risk. To the extent that you will reveal your defense to your adversary, you already do that anytime your client makes a proffer, whether it be through formal § 6002 immunity, the informal equivalent, Rules 410 and 11(f), or by way of a traditional QFAD letter. To the extent that your client’s statement constitutes an admission that the government can use in any way it sees fit, that is no different than the situation your client is in when he makes a proffer pursuant to a QFADFH letter. What is the right case? The case where you represent an individual whose reputation will be a significant element of the defense and who will be ruined unless you can convince the government not to indict.

But what if you were not the defendant’s first lawyer? What if you are retained after plea discussions have fallen through and you learn that your new client spoke to the prosecutor pursuant to a QFADFH agreement? In that case, you first need to determine if your client made an intelligent waiver of his rights. By agreeing that his statements can be used against him if he offers any arguments or evidence in his defense, he has essentially abandoned his Fifth Amendment right against self-incrimination and his Sixth Amendment right to present a defense. He may also have forfeited his Sixth Amendment right to confront the witnesses against him. Did your client really understand the consequences of his decision to speak under these circumstances? If not, the agreement may not pass constitutional muster.7

A corollary to the issue of waiver is the question of effective assistance of counsel. Did counsel know enough about the facts to effectively advise his client to speak to the prosecutor? This has become a more critical issue as a result of the decision of the Supreme Court in United States v. Ruiz,8 holding that the government is not obligated to provide Brady9 information before a plea is entered.

Assuming that the waiver was knowing and intelligent and that defense counsel was not ineffective, you may still be able to attack the procedure on constitutional or statutory grounds. The only time that the Supreme Court has considered Queen for a Day agreements was in United States v. Mezzanatto,10 which involved impeachment of a defendant’s testimony at trial. In Mezzanatto, a majority of justices (one since replaced) made clear that their decision was limited to that scenario. While the Krilich and Velez decisions relied on Mezzanatto, there is a compelling argument to be made that the Supreme Court did not intend to go as far as those decisions.

The question presented in Mezzanatto was whether an accused can waive the protections afforded by Rules 410 and 11(f). Both rules provide that statements made in the course of plea discussions between a defendant and a prosecutor are inadmissible in evidence. As a condition of speaking to the prosecutor, Mezzanatto was required to waive that protection. Unfortunately, Mezzanatto was not able to convince the government of his innocence, and when he took the witness stand at trial he was impeached by his own statement during the proffer session.

On appeal, the Ninth Circuit reversed his conviction, holding that the rules could not be waived. Not surprisingly, the Supreme Court disagreed. The Court began its analysis by agreeing that there may be some evidentiary rules so fundamental to the reliability of the fact-finding process that they cannot be waived. This, however, was not one of them.11 If anything, the admission of a plea statement for impeachment purposes enhances the truth seeking process.12

This conclusion sounds reasonable enough. After all, why should a defendant be permitted to take the stand and perjure himself? But there is reason to believe that Congress chose a different means of deterring defendants from testifying falsely. A specific exception contained within Rules 410 and 11(f) permits the use of statements made during plea negotiations to be used in a separate prosecution for perjury. Given this exception, Congress was clearly aware of the possibility that a defendant could take the witness stand and testify contrary to what was said during plea negotiations. Congress could have made such statements admissible at trial for impeachment. But Congress chose a different remedy.

The government has never suggested that, in the absence of a waiver, it would be permissible to impeach a defendant with statements made during plea negotiations. The rules permit no such exception. Thus, this is not an instance where the statute was in any way ambiguous. Its proscriptions and exceptions are as plain as day. But as early as 1938 the Supreme Court in Johnson13 held that even constitutional protections could be waived and the Court in Mezzanatto was persuaded that waiver in this instance would serve to best effectuate congressional intent. What!?

That’s right. Even though Congress chose one remedy to deter perjured testimony, the Supreme Court held that an even better remedy would be to permit prosecutors to impeach defendants with their prior statements at trial. The Court was persuaded that prosecutors would more likely engage in plea negotiations if they had confidence that the defendants knew the price of lying to them. But as Barry Tarlow points out, this conclusion is “short-sighted” and “wrong-headed.”14 What defendants know is the price of not telling prosecutors what they want to hear. Ironically, the result is less, not greater, reliability in testimony.

As discussed above, Mezzanatto only involved the traditional QFAD letter. Does its rationale support the result reached by the courts in Velez and Krilich? Certainly not as a matter of policy. If the goal is to make perjury costly, permitting prosecutors to cross-examine defendants with prior inconsistent statements serves that purpose. And that was as far as Justices Ginsburg, O’Connor, and Bryer were willing to go (see their concurrence in Mezzannatto). But Justices Souter and Stevens predicted that QFAD letters would morph into QFADFH letters which “in time come to function as a waiver of trial itself.”15 The Justices predicted that, “If objection can be waived for impeachment use, it can be waived for use as affirmative evidence, and if the Government can effectively demand waiver in the former instance, there is no reason to believe it will not do so just as successfully in the latter.”16

To whatever extent the Supreme Court is correct that QFAD agreements help to foster the plea bargaining process, the same cannot be said of QFADFH proffers. It is one thing to agree to forgo taking the witness stand in one’s own defense. It is quite another to agree to forgo presenting any defense if a prosecutor is not satisfied with the assistance the defendant has to offer. Indeed, given the nature of the rights at stake (no less than the right to have the jury determine one’s guilt or innocence), it is an open question whether a defendant can give up the right to present any defense through argument, cross-examination, or presentation of witness without a searching inquiry by a court.

Properly understood, Mezzannatto demonstrates why Krilich and Velez were wrongly decided. Consequently, defense counsel should not hesitate to refuse to sign on to proffer agreements that in truth offer the defendant no protection at all. Where counsel is confronted with such an agreement entered into prior to his appearance, counsel should vigorously seek its recision as unconstitutional and in violation of existing statutory provisions. Anything less is to surrender to another procedure that threatens to undermine the already endangered balance between the state and the individual.

Notes
1. 159 F.3d 1020 (7th Cir. 1998).
2. 354 F.3d 190 (2d Cir. 2004).
3. The Champion, March 2005 at 53.
4. 543 U.S. 220 (2005).
5. I would like to thank the various attorneys quoted in this article who detailed their experiences in an informal survey conducted on the NACDL’s white collar listserve.
6. United States v. Morgan, 91 F.3d 1193, 1195-96 (8th Cir. 1996); United States v. Penta, 898 F.2d 815, 817-18 (1st Cir. 1990).
7. Boykin v. Alabama, 395 U.S. 238 (1969).
8. 536 U.S. 622 (2002).
9. Brady v. Maryland, 373 U.S. 83 (1963).
10. 513 U.S. 196 (1995).
11. Id. at 204.
12. Id.
13. Johnson v. Zerbst, 304 U.S. 458, 465 (1938).
14. The Champion, supra, at 56.
15. Id. at 217.
16. Id.


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