Federal Evidence Review

In the Enron prosecution, the defendant failed to meet his burden to show “that the government was responsible for the unavailability of the declarants”; Fifth Circuit also notes an issue of “first impression”: “whether, to invoke Rule 804(b)(6) properly, a party must make this evidentiary showing with material independent of the hearsay itself,” in United States v. Skilling, 554 F.3d 529 (5th Cir. 2009) (No. 06-20885)

The well-publicized Enron prosecution recently raised some interesting questions concerning the forfeiture by hearsay exception under FRE 804(b)(6), including an issue of “first impression” in the Fifth Circuit.

In the case defendant former Enron CEO Jeffrey K. Skilling was indicted with conspiracy, securities fraud, making false representations to auditors, and insider trading offenses. In preparing for trial, his defense team sought to interview “hundreds of individuals involved in some way with Enron, but few agreed even to meet with him. In April 2005, he sent letters to 144 potential witnesses requesting meetings, but only two accepted the invitation. In May 2005, he sent 138 more letters, but only two more agreed. The district court then sent letters to thirty-eight potential witnesses to inform them that the government would not retaliate against them if they cooperated with Skilling. Even after the district court sent these letters, regarding prosecution however, only one more witness came forward.” Skilling, 554 F.3d at 565 (footnote omitted). In the district court letter, the witnesses were advised witnesses identified by the prosecution and defense:

“[the court has] been informed by the government that if you wish to speak with defense counsel: (i) you need not seek permission from the government or notify them about the meetings; (ii) you have the government’s consent to meet with the defense to the extent such consent is required by any agreement you may have with the government; (iii) you are free to discuss whatever you choose to discuss, whether or not you have any agreement with the government limiting what information may be shared with third parties; and (iv) you are free to agree to testify on defendants’ behalf at trial.”

“Finally, if you believe it would help you decide whether to meet with defense counsel or testify on their behalf at trial, I am willing to meet with you, along with representatives of all parties, to address any concerns about speaking to the defense in this case.

The court also “issued an order, dated May 27, 2005, to address any of the witnesses’ concerns that the government would retaliate against those that cooperated with Skilling. The order provided that:

1. All counsel in a criminal proceeding may seek to contact and interview witnesses before trial.
2. Whether or not a witness wishes to talk to the attorneys or representatives of either party in this case is entirely up to the witness.
3. Should a witness decide to provide information or assistance to the defense, the government will not view the witness’s decision to cooperate with defense counsel as any lack of cooperation with the government, and the government will not use such cooperation as a basis for decisions regarding prosecution.”

Skilling, 554 F.3d at 565 n.58.

The defendant claimed the government substantially interfered with his ability to communicate with witnesses and present his defense. After an evidentiary hearing, the district court concluded the defense had failed to show prosecutorial misconduct. After his conviction, for the first time on appeal, the defendant claimed that hearsay statements he submitted should have been considered by the district court under the forfeiture by wrongdoing hearsay exception, FRE 804(b)(6).

The Fifth Circuit reviewed the forfeiture by wrongdoing claim for plain error, since no objection under FRE 804(b)(6) had been raised before the district court, and no plain error was shown. In considering the issue, the circuit noted an open issue on the proponent’s burden to demonstrate the admissibility of the hearsay statements. In relying on FRE 804(b)(6), defendant “Skilling had the burden of showing that the government was responsible for the unavailability of the declarants.” Skilling, 554 F.3d at 568. However, the circuit noted an issue of “first impression”: “whether, to invoke Rule 804(b)(6) properly, a party must make this evidentiary showing with material independent of the hearsay itself.” Skilling, 554 F.3d at 568. The circuit did not resolve the issue but noted “there are persuasive arguments for either position or for a hybrid of the two.” Skilling, 554 F.3d at 668 (footnote omitted). The challenge in the case was “that it was the defense counsel who made the uncorroborated hearsay declarations. Under such circumstances, any error is not plain.” Skilling, 554 F.3d at 568 (footnote omitted). The trial court acted with care in holding an evidentiary hearing. The hearsay declarations of most attorneys were insufficient to meet the defendant’s burden.

On other related issues, the Fifth Circuit concluded:

• Cooperation plea agreement terms with Merrill Lynch and Canadian Imperial Bank of Commerce did not improperly preclude corporate employees from cooperating with the defense; further, the district court letter to the witnesses “eliminated any potential confusion or misunderstanding.” Skilling, 554 F.3d at 570.
• The general claims of witness intimidation were unfounded particularly in light of the district court’s letter to potential witnesses. As the circuit noted, Nothing in the record indicates that the government extended or enlarged its ongoing investigation to intimidate witnesses.”
• On specific claims of witness intimidation, there was no showing that the district court’s findings of fact that there was no intimidation were clearly erroneous. During specific instances, counsel who received government e-mails and communications indicated they did not influence the decision on whether to cooperate with the defense. On a couple of witnesses, the defense did not request that the district court send its letter advising witnesses that they could meet with the defense without any repercussions.
• On the record, there was no violation of the Sixth Amendment right to present witnesses on his behalf and his Fifth Amendment right to be free from governmental interference when preparing his defense.
• In addition to the issue of “first impression,” the case highlights an interesting application of FRE 804(b)(6) against the government. Normally, the rule is used to admit a hearsay statement against a defendant who commits wrongdoing which results in the unavailability of a witness.

In Giles v. California, 554 U.S. _, 128 S.Ct. 2678, 2684 (June 25, 2008), the Supreme Court held that under the Confrontation Clause, the forfeiture by wrongdoing exception requires the proponent to show that “the defendant intended to prevent a witness from testifying.” The Court considered application of a state forfeiture by wrongdoing provision and not FRE 804(b)(6). The Skilling court reached a similar finding concerning the Federal Forfeiture by Wrongdoing Exception in FRE 804(b)(6): the proponent of applying the FRE 804(b)(6) exception must meet a burden of showing “that the government was responsible for the unavailability of the declarants.” But the case also indicates many of the unexpected twists and turns in trying to apply this doctrine.