Monday, February 15, 2010

Summary Summary

As noted below, the circuit has been a bit slow this month. But here are three more summary orders of interest.

In United States v. Valentin, No. 07-5278-cr (2d Cir. February 9, 2010), the court ordered a Jacobson remand for the district court to clarify whether it would have imposed a shorter sentence if it understood it was permitted to do so under the Williams/Whitley decisions.

In United States v. Drayer, No. 07-1521-cr (2d Cir. February 9, 2010), the district court at sentencing accepted the government's representation as to the loss amount, but then at a later restitution hearing came up with a loss figure that was seven million dollars lower, rendering the loss figure used at sentencing clearly erroneous. The circuit also found plain error in the district court's inclusion of an enhancement for more than fifty victims, since the only victims the district court included in the loss calculation were the four financial institutions affected by the scheme. Finally, the court remanded for reconsideration of the restitution order since it was unclear whether the district court took into consideration funds that some of the victims received from a civil settlement.

In United States v. Shuster, No. 08-1182-cr (2d Cir. January 19, 2010), the government conceded that it had mistakenly persuaded the district judge to consider a separate fraud case as both relevant conduct and as a "prior sentence" in the defendant's criminal history score. The circuit vacated the sentence.

PC World

It's been more than a month since the court issued a signed opinion in a criminal case. But here is its latest Per Curiam.

In Re Grand Jury Subpoena Issued June 18, 2009, No. 09-3561-cv (2d Cir. February 1, 2010) (per curiam). In this case, the court rejected a challenge to a subpoena for corporate records where the corporate entities had a sole shareholder, officer and employee, Douglas Rennick. The companies argued that they could resist the subpoena on Fifth Amendment grounds since Rennick was the only person capable of producing the records and his act of production would be testimonial and potentially self-incriminating.

The court noted that the "collective entity rule" prevented the corporations from invoking a Fifth Amendment privilege and that the custodian of corporate records, acting as a representative of the corporation, cannot refuse to produce them on Fifth Amendment grounds. The circuit has long
held that there was no exception to this for corporations that were essentially "one-man" operations, but here the corporations pointed out a more recent Supreme Court case, Braswell, that held that the custodian of a one-man corporation's records could not resist a subpoena, but that if the custodian were to stand trial, the government could not introduce evidence that the custodian himself produced the records, since he had acted in his representative capacity, not personally. Braswell left open the question whether a custodian could resist a subpoena if he could establish that the jury would "inevitably conclude that he produced the records."

Despite this language, the circuit held to the rule that there "simply is no situation" in which a corporation can avail itself of the Fifth Amendment privilege, calling it "sensible" because it (1) prevents the erosion of the collective entity rule, (2) recognizes that the decision to incorporate is freely made and generates both benefits and burdens, and (3) avoids creating a category of organizations "effectively immune form regulation" by being outside of the government's subpoena power.