Opinion
00 Civ. 7352 (GEL).
June 21, 2004
Mortin J. Turchin, Turchin Hoffman, P.C., New York, NY, for Petitioner.
Irving Bizar, Ballon Stoll Bader Nadler, P.C., New York, NY, for Respondents.
Roger Bennet Adler, New York, NY, for Defendant Norman Goldstein.
OPINION AND ORDER
In connection with proceedings to enforce a judgment in this action, respondents Benedict Properties, LLC, Daniel Benedict, and Values Holdings, LLC (collectively, "Benedict"), issued subpoenas for the depositions of defendants Norman Goldstein and Mattie Goldstein. Norman Goldstein appeared, but asserted his Fifth Amendment privilege against self-incrimination in response to virtually all questions. Mattie Goldstein did not appear. Benedict moves for an order holding both in contempt. For the reasons that follow, the motion will be denied as to Norman Goldstein, and an order to show cause shall issue as to Mattie Goldstein.
Petitioner Sterling National Bank joins in Benedict's motion "in so far as [Benedict] seek[s] to compel testimony from the witnesses. Norman Goldstein and Mattie Goldstein, not barred by the appropriate assertion of any applicable privilege." (Turchin Aff. ¶ 2.)
I. Norman Goldstein
Benedict has not established that Norman Goldstein's behavior was contumacious. A witness in a civil matter may assert his Fifth Amendment privilege against self-incrimination where he reasonably believes that his testimony could be used against him in a criminal matter, either directly or by leading to other evidence. Kastigar v. United States, 406 U.S. 441, 444-45 (1972); see also Lefkowitz v. Turley, 414 U.S. 70, 77-78 (1973); Malloy v. Hogan, 378 U.S. 1, 11-12 (1964); Hoffman v. United States, 341 U.S. 479, 486-87 (1951). Because, at the time of his deposition, Norman Goldstein awaited sentencing on criminal charges that related directly to the subject matter of these civil proceedings, the reasonableness of his assertion of the Fifth Amendment is obvious. See Mitchell v. United States, 526 U.S. 314, 325-26 (1999) (Fifth Amendment privilege continues until conviction and sentence have become final); see also United States v. Domenech, 476 F.2d 1229, 1231 (2d Cir. 1973) (Fifth Amendment privilege continues after guilty plea);Bank One of Cleveland, N.A. v. Abbe, 916 F.2d 1067, 1075 (6th Cir. 1990) (Fifth Amendment privilege "continues in force until sentencing"; collecting cases).
Even now, after sentence has been imposed, Goldstein's privilege assertion remains reasonable, for he has appealed his conviction and thus remains in jeopardy insofar as any testimony he offers in these proceedings could potentially prejudice him either in connection with his appeal or at a possible retrial. See Taylor v. Best, 746 F.2d 220, 222 (4th Cir. 1984); Holsen v. United States, 392 F.2d 292, 293 (5th Cir. 1968); Prentice v. Hsu, 280 F. Supp. 384, 388 (S.D.N.Y. 1968) (recognizing that despite defendant's conviction, "it does not automatically follow that the questions presented . . . will not incriminate him," for "[t]he issues raised are not yet moot since appeal may bring about a new trial"); accord, People v. Chambers, 585 N.Y.S.2d 84, 85 (2d Dep't 1992); Ellison v. State, 528 A.2d 1271, 1278 (Md. 1987); cf. Ottomano v. United States, 468 F.2d 269, 274 (1st Cir. 1972) (sustaining privilege where motion to vacate had been pending, because had it been granted, defendant could have been retried, in which event "any testimony given . . . would have been admissible against him"). Furthermore, Goldstein's criminal counsel offers an affirmation averring that in his professional opinion, Goldstein's fear that his responses to questions in these civil proceedings could tend to incriminate him is reasonable. (Adler Aff. ¶ 5.)
Neither the Supreme Court nor the Second Circuit has explicitly addressed the availability of the Fifth Amendment privilege against self-incrimination to convicted defendants with pending appeals. But the cited decisions of other federal circuits and state courts are consistent with Mitchell, 526 U.S. at 326, which held that a defendant may continue to assert his Fifth Amendment privilege against self-incrimination until his judgment of conviction becomes "final." "Finality is variously defined; like many legal terms, its precise meaning depends on context." Clay v. United States, 537 U.S. 522, 527 (2003). In the context of petitions for post-conviction relief, "[f]inality attaches when th[e] [Supreme] Court affirms a conviction on the merits on direct review or denies a petition for a writ of certiorari, or when the time for filing a certiorari petition expires." Id. Similarly, where, as here, the defendant has been convicted, but that conviction is on appeal, the judgment cannot be deemed final for purposes of the privilege because testimony offered in related civil proceedings has the potential to prejudice him in connection with his appeal and at a potential retrial. Hence, it is not the case that "no adverse consequences can be visited upon the convicted person by reason of further testimony." Mitchell, 526 U.S. at 326.
Benedict asks the Court to disregard Goldstein's belated submission in opposition to the contempt motion because he allegedly did not receive a copy of it until May 25, 2004, although it was due on May 14. While Goldstein's counsel did not, in fact, file the submission until May 25, Benedict's counsel actually replied to it on May 19, indicating that he must have received a copy of it before that date.
Of course, the general reasonableness of a fear of potential self-incrimination does not justify a refusal to answer any and all questions; the appropriateness of assertions of privilege must be determined on a question-by-question basis. See Estate of Fisher v. Comm'r of Internal Revenue, 905 F.2d 645, 649 (2d Cir. 1990); see also United States v. Aeilts, 855 F. Supp. 1114, 1116 (C.D. Cal. 1994) ("blanket" assertions of privilege impermissible; rather "[t]he person must claim the privilege on a document-by-document or question-by-question basis"). But Benedict entirely fails to carry its burden of demonstrating that Goldstein's assertion of the privilege was in bad faith, either generally or as to any particular question. Neither in its initial motion nor in its reply does Benedict focus on any question in particular; it simply remarks that "a cursory glance at the transcript . . . clearly shows that not every question could have touched on privileged material." (Bizar Reply Aff. ¶ 5.) But it is not the Court's job to parse the transcript, guessing at the basis of assertions of privilege as to each question. Certainly, in the case of a witness under indictment on charges closely related to the subject of the deposition, the presumption must be that his assertion of privilege as to any relevant question is reasonable, at least absent some further showing by the movant. See Hoffman, 341 U.S. at 486-87 ("To sustain the privilege, it need only be evident from the implications of the question, in the setting in which it is asked, that a responsive answer to the question or an explanation why it cannot be answered might be dangerous because injurious disclosure could result.").
Accordingly, as to Norman Goldstein, the assertion of the privilege is sustained, and the motion for an order of contempt is denied.
II. Mattie Goldstein
Mattie Goldstein presents a different issue. So far as the record indicates, despite being properly served with a subpoena (Bizar Aff. ¶ 4, Ex. A), she simply failed to appear on the date and time specified. (Bizar Aff. ¶ 10; Reply Aff. ¶ 6.) "[A] refusal to appear for an examination . . . is in a different category than a refusal to answer questions protected by the Fifth Amendment." Hudson Tire Mart, Inc. v. Aetna Cas. and Sur. Co., 518 F.2d 671, 674 (2d Cir. 1975). She has not responded to this motion for an order of contempt. Nor has she offered any explanation, justification or excuse for her failure to appear.
Rule 45(e) of the Federal Rules of Civil Procedure provides that "[f]ailure by any person without adequate excuse to obey a subpoena served upon that person may be deemed a contempt of the court from which the subpoena issued." Before imposing sanctions on a person charged with civil contempt, due process requires that the person receive notice and an opportunity to be heard.Shoenberg v. Shapolsky Publishers, Inc. 971 F.2d 926, 934-35 (2d Cir. 1992), overruled in part on other grounds, Bassett v. Mashantucket Pequot Tribe, 204 F.3d 343 (2d Cir. 2000). This motion, of course, gave Mattie Goldstein notice and an opportunity to be heard, and she failed to avail herself of these rights. The Court therefore has the power to issue an order of contempt under Rule 45(e). See Diamond v. Simon, No. 89 Civ. 7061, 1994 WL 10622, at *1 (S.D.N.Y. Jan. 10, 1994).
Nevertheless, the Court declines to do so at this juncture. On the one hand, the Advisory Committee Notes to Rule 45 make clear that "[a]lthough the subpoena is in a sense the command of the attorney who completes the form, defiance of a subpoena is nevertheless an act in defiance of a court order and exposes the defiant witness to sanctions." See Fisher v. Marubent Cotton Corp., 526 F.2d 1338, 1340-41 (8th Cir. 1975); Higginbotham v. KCS Int'l, Inc., 202 F.R.D. 444, 455 (D. Md. 2001). On the other, the Court recognizes that, as the Advisory Committee Notes to Rule 45 also explain, "because the command of the subpoena is not in fact one uttered by a judicial officer, contempt should be very sparingly applied." See also Cruz v. Meachum, 159 F.R.D. 366, 368 (D. Conn. 1994) ("A subpoena, obtainable as of course from the Clerk of the Court or issued by an attorney without any court involvement, is not of the same order as one issued by a judicial officer in the resolution of a specific dispute.").
An order of contempt leading to the imposition of sanctions is a drastic remedy. Hence, here, as in Diamond, 1994 WL 10622, while "the Court has the power under Rule 45(e) to impose contempt simply upon the basis of [Mattie Goldstein]'s failure to comply" with the subpoena issued by Benedict commanding her appearance for deposition, "the Court will instead . . . permit [her] a final opportunity to avoid being held in contempt of court." Id. at *1.
Of course, the simplest way for Mattie Goldstein to avoid an order of contempt would be for her to comply with Benedict's subpoena, appear for the deposition, and answer any questions posed by Benedict insofar as they seek information not privileged. If the Court is notified that she has appeared for a deposition by July 2, 2004, no order of contempt will be issued. Should she instead persist in defying the subpoena, she is directed to appear and show cause why her failure to appear for a deposition in this matter does not constitute a contempt of court.
It is not clear whether Mattie Goldstein has a reasonable basis to assert the Fifth Amendment privilege against self-incrimination in these proceedings. To the extent that she has reasonable grounds to assert the Fifth Amendment privilege, the general principles articulated in the text in connection with the analysis of Norman Goldstein's circumstances would govern any such assertion.
Accordingly, it is hereby ORDERED that:
1. The motion for an order of contempt as to Norman Goldstein is denied.
2. Mattie Goldstein shall appear before the Court on Friday, July 2, at 10:00 A.M. to show cause why she should not be held in contempt, unless before that time she appears for a deposition pursuant to the subpoena served upon her by Benedict.
3. Benedict is hereby directed to serve a copy of this opinion and order on Mattie Goldstein.
SO ORDERED.