United States v. Neely ( 1996 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 94-5107
ROBERT KEITH NEELY,
Defendant-Appellant.
Appeal from the United States District Court
for the Western District of Virginia, at Roanoke.
Jackson L. Kiser, Chief District Judge.
(CR-92-78-R)
Argued: November 3, 1995
Decided: February 13, 1996
Before WIDENER, WILKINSON, and WILLIAMS, Circuit Judges.
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Affirmed by unpublished per curiam opinion.
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COUNSEL
ARGUED: Marvin David Miller, Alexandria, Virginia, for Appel-
lant. Thomas Ernest Booth, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Thomas M.
Blaylock, Roanoke, Virginia, for Appellant. Robert P. Crouch, Jr.,
United States Attorney, Karen B. Peters, Assistant United States
Attorney, UNITED STATES DEPARTMENT OF JUSTICE, Wash-
ington, D.C., for Appellee.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
Robert Keith Neely appeals his convictions on money laundering
and narcotics charges, contending that they are invalid on several
grounds. Specifically, Neely claims that: (1) the district court erred in
refusing to dismiss for prosecutorial misconduct; (2) the Government
used documents in its investigation of Neely that he produced pursu-
ant to a use-immunity order, in violation of Neely's Fifth Amendment
right against compelled self-incrimination; (3) the Government know-
ingly allowed counsel laboring under an actual conflict of interest to
represent Neely, in violation of his Sixth Amendment right to coun-
sel; (4) the Government abused the grand jury process; (5) the district
court erred in permitting two Government case agents to remain in the
courtroom during trial; and (6) Neely's convictions on Counts Two
and Three are mutually exclusive, requiring vacatur of the conviction
on Count Three. We reject all of these contentions and accordingly
affirm Neely's convictions.
I.
The evidence presented at trial, viewed in the light most favorable
to the Government, Glasser v. United States, 315 U.S. 60, 80 (1942),
establishes the following facts. Until his convictions, Neely was an
attorney with a sole-practice law firm, R. Keith Neely, P.C., in Chris-
tiansburg, Virginia, specializing in criminal defense work. In May
1986, while representing one of several defendants in a complex drug
conspiracy case, Neely met Donald Kimbler, a private investigator
from Miami, Florida, who was working for another attorney involved
in the same case. At that time, Kimbler, a former agent for the Bureau
of Alcohol, Tobacco, and Firearms (ATF), was a small-scale cocaine
dealer in the Miami area, but had never used cocaine himself. Kim-
bler and Neely quickly became close friends, and Neely introduced
Kimbler to the use of cocaine.
2
At Kimbler's request, Neely introduced Kimbler to persons inter-
ested in purchasing cocaine. Neely arranged a meeting between Kim-
bler and Leigh Hurst, a drug dealer and longtime friend of Neely's.
Hurst was wary of Kimbler's former connection to ATF, and refused
to deal with Kimbler unless Neely acted as intermediary. Accord-
ingly, Neely, Hurst, and Kimbler devised an arrangement pursuant to
which Neely brokered cocaine transactions between Hurst and Kim-
bler. Neely simply was present during some transactions, but on other
occasions Neely received cocaine from Kimbler and delivered it to
Hurst, who gave money to Neely for delivery to Kimbler. In return
for his efforts, Neely received approximately $200 per ounce from
Kimbler, or one-third of Kimbler's profits; Neely also received 2.5
grams of cocaine from Hurst for every ounce Hurst purchased. Hurst
estimated that he purchased eight pounds of cocaine from Kimbler
through Neely from October 1986 through November 1987.
Neely also introduced Kimbler to Fred Roland "Butch" Franklin,
III, a high-school classmate of Neely's. As with Kimbler and Hurst,
Neely facilitated cocaine transactions between Kimbler and Franklin.
Kimbler estimated that he sold approximately 4.56 pounds of cocaine
to Franklin through Neely.
In 1987, Neely agreed to purchase a parcel of land near Claytor
Lake in Pulaski County, Virginia for $50,000. Neely was to make a
down payment of $8,000 and to pay the balance in quarterly install-
ments of $4,200. Neely, evidently unable to meet this payment sched-
ule, approached Kimbler and offered to make him a silent partner in
the land purchase. Ultimately, Kimbler made the $8,000 down pay-
ment and agreed to alternate installment payments with Neely. How-
ever, Kimbler's name was not recorded on the deed to the property,
nor was the agreement memorialized. Kimbler testified that the
$8,000 used for the down payment came from a payment he had
received for guarding a shipment of cocaine to Miami. Neely depos-
ited the $8,000 into either his personal account or one of the law
firm's corporate accounts, then drew a check on that account, payable
to the seller of the land, for $8,000. This pattern of conduct was
repeated for each quarterly payment made by Kimbler.
In August 1988, Kimbler and Neely had a disagreement concerning
the payments on the property, as a result of which Kimbler ceased to
3
make quarterly installment payments. Shortly thereafter, Neely sought
to make a new partnership arrangement with another friend, Michael
Giacolone, for the purpose of continuing the payments. Giacolone
gave Neely $42,000 in cash in exchange for a one-half interest in the
property; this money represented profits from drug transactions.
Neely instructed his secretary to deposit the $42,000 into his corpo-
rate and personal accounts in small increments in order to evade fed-
eral reporting requirements. Although Neely and Giacolone executed
a partnership agreement, Giacolone's name was never recorded on the
deed to the property.
The Government began to investigate Neely's activities in the late
1980s. In a 1990 case unrelated to the instant offenses, Neely pleaded
guilty to misdemeanor possession of cocaine after he was videotaped
using cocaine with a government informant. Also in 1990, Neely was
indicted on charges of tampering with a grand jury, although he evi-
dently was never prosecuted.1
A grand jury in the Western District of Virginia returned a
fourteen-count, superseding indictment on September 22, 1992,
charging Neely with racketeering, see 18 U.S.C.A. § 1962(c) (West
1984) (Count One) (including six acts of racketeering); conspiracy to
aid and abet the distribution of marijuana and cocaine, to possess with
intent to distribute marijuana and cocaine, and to distribute marijuana
and cocaine, see 18 U.S.C.A. § 2 (West 1969), 21 U.S.C.A.
§ 841(a)(1) (West 1981) (Count Two); aiding and abetting the distri-
bution of cocaine, see 18 U.S.C.A. § 2, 21 U.S.C.A. § 841 (Count
Three); money laundering, see 18 U.S.C.A.§ 1956(a)(1)(B)(i) (West
Supp. 1995) (Counts Four through Nine);2 distribution of marijuana,
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1 The district court dismissed the indictment because the prosecution
failed to provide exculpatory evidence to the grand jury. The Govern-
ment appealed, and we reversed on the authority of United States v.
Williams, 504 U.S. 36 (1992) (holding that prosecutor is not required to
present exculpatory evidence to the grand jury). See United States v.
Neely, 966 F.2d 1445 (4th Cir. 1992) (per curiam) (unpublished), cert.
denied, 113 S. Ct. 1261 (1993). Although the record before us is unclear,
apparently the Government did not re-indict Neely.
2 Counts Four and Five related to Neely's dealings with Kimbler
regarding the Claytor Lake property. Counts Six through Nine charged
Neely with money laundering related to his various dealings with Giaco-
lone, including the $42,000 paid by Giacolone for a one-half interest in
the Claytor Lake property (Count Seven).
4
see 21 U.S.C.A. § 841(a)(1) (Count Ten); accessory after the fact to
Giacolone's drug offenses, see 18 U.S.C.A.§ 3 (West Supp. 1995)
(Counts Eleven and Twelve); tampering with a witness, see 18
U.S.C.A. § 1512 (West Supp. 1995) (Count Thirteen); and criminal
forfeiture of certain assets and property, see 18 U.S.C.A. § 982 (West
Supp. 1995) (Count Fourteen). The district court dismissed Counts
Twelve and Thirteen and one act of racketeering prior to trial, and
Neely proceeded to trial on the remaining counts. After a two-week
trial, the jury convicted Neely of conspiracy to possess cocaine for
personal use (the lesser included offense of Count Two), aiding and
abetting the distribution of cocaine (Count Three), money laundering
(Count Seven), and distribution of marijuana (Count Ten).3 The dis-
trict court sentenced Neely to 121 months imprisonment, but released
him on bond pending appeal.
Throughout the pretrial proceedings, trial, and post-trial proceed-
ings, Neely filed a plethora of motions seeking to exclude evidence
or to dismiss the indictment altogether. Although Neely has been
somewhat more selective in his arguments on appeal, he nevertheless
asserts a broad array of reversible errors. We address these conten-
tions seriatim.
II.
Neely first asserts that the district court erred in denying his numer-
ous motions to dismiss the indictment for prosecutorial misconduct.4
Relying in part on the precept that, "while [the prosecutor] may strike
hard blows, he is not at liberty to strike foul ones," Berger v. United
States, 295 U.S. 78, 88 (1935), overruled on other grounds by Stirone
v. United States, 361 U.S. 212 (1960), Neely urges us to vacate his
convictions on two grounds. First, Neely claims that the Government
committed certain acts of misconduct during the course of the investi-
gation and preparation of the case against Neely. Second, Neely
claims that the Government withheld numerous pieces of exculpatory
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3 Neely's conviction for distribution of marijuana was based on his pro-
vision of marijuana to Shirley Bassett, a friend.
4 Neely moved to dismiss the indictment based on allegations of pro-
secutorial misconduct and withholding of exculpatory evidence no fewer
than five times.
5
evidence in violation of Brady v. Maryland, 373 U.S. 83 (1963), and
its progeny.
The duty of the Government is not to obtain a conviction, but
rather is to ensure that justice is achieved. Berger, 295 U.S. at 88. Jus-
tice is not obtained, and reversal is required, when improper conduct
by the prosecutor "so infect[s] the trial with unfairness as to make the
resulting conviction a denial of due process." Darden v. Wainright,
477 U.S. 168, 181 (1986) (internal quotation marks omitted). In order
to obtain reversal of his convictions based on misconduct by the Gov-
ernment, Neely must satisfy a two-prong test: "`(1) the prosecutor's
remarks or conduct must in fact have been improper, and (2) such
remarks or conduct must have prejudicially affected the defendant's
substantial rights so as to deprive the defendant of a fair trial.'"
United States v. Brockington, 849 F.2d 872, 875 (4th Cir. 1988)
(quoting United States v. Hernandez, 779 F.2d 456, 458 (8th Cir.
1985)). To the extent that the district court makes factual findings
regarding a defendant's claims of prosecutorial misconduct, our
review is for clear error; in the absence of such findings, however, our
review is plenary. United States v. McDonald, 61 F.3d 248, 253 (4th
Cir. 1995). We first examine the acts of misconduct alleged by Neely
and then proceed to an examination of his Brady claims.
A.
Neely claims that the Government committed three acts of miscon-
duct during the investigation and preparation of the case against him.
First, Neely contends that the Government violated its duty to inform
the district court of the existence of a conflict of interest when it
knowingly permitted Neely's former attorney, James C. Turk, Jr., to
represent Hurst despite Turk's knowledge that Hurst intended to tes-
tify against Neely. See United States v. Tatum , 943 F.2d 370, 379-80
(4th Cir. 1991) ("[W]hen a conflict situation becomes apparent to the
government, the government has a duty to bring the issue to the
court's attention and, if necessary, move for disqualification of coun-
sel."). We address this purported conflict in more detail in Part IV,
infra. For purposes of addressing Neely's prosecutorial misconduct
claim, we need only note that Turk did not represent Neely on the
instant charges; thus, any conflict that may have existed was not
related to this case, and, even if the Government did have a duty to
6
inform the court of the presence of a conflict, that duty did not exist
in this case. See generally Hoffman v. Leeke, 903 F.2d 280, 285-86
(4th Cir. 1990) (delineating circumstances in which attorney faces
actual conflict of interest).
Second, Neely maintains that the Government violated his Sixth
Amendment right to counsel when it, knowing that Neely was repre-
sented by counsel on pending charges of grand jury tampering,
equipped Hurst with a recording device and tape-recorded two con-
versations between Neely and Hurst. See Massiah v. United States,
377 U.S. 201 (1964) (holding that covert interrogation of defendant
after right to counsel has attached violates Sixth Amendment). Of
course, Neely is correct that, under Massiah, "[a]ny secret interroga-
tion of the defendant, from and after the finding of the indictment,
without the protection afforded by the presence of counsel" is a viola-
tion of the defendant's Sixth Amendment right to counsel. Id. at 205(internal quotation marks omitted). The Sixth Amendment right to
counsel, however, "is offense specific. It cannot be invoked once for
all future prosecutions, for it does not attach until a prosecution is
commenced," e.g., upon the return of an indictment. McNeil v.
Wisconsin, 501 U.S. 171, 175 (1991); see also Kirby v. Illinois, 406
U.S. 682, 689 (1972) (stating that the Sixth Amendment right to coun-
sel attaches upon "the initiation of adversary judicial criminal
proceedings--whether by way of formal charge, preliminary hearing,
indictment, information, or arraignment"). Accordingly, the mere fact
that an individual has been indicted for a criminal offense does not
preclude the investigation of other suspected criminal activity:
The police have an interest . . . in investigating new or addi-
tional crimes [after an individual is formally charged with
one crime.] . . . [T]o exclude evidence pertaining to charges
as to which the Sixth Amendment right to counsel had not
attached at the time the evidence was obtained, simply
because other charges were pending at that time, would
unnecessarily frustrate the public's interest in the investiga-
tion of criminal activities.
Maine v. Moulton, 474 U.S. 159, 179-80 (1985); see also id. at 180
n.16 ("Incriminating statements pertaining to other crimes, as to
which the Sixth Amendment right has not yet attached, are, of course,
7
admissible at a trial of those offenses."); United States v. Kidd, 12
F.3d 30, 32 (4th Cir. 1993) (same), cert. denied , 114 S. Ct. 1629(1994).
Neely's claim that the Government violated Massiah is based on
the fact that he was represented by counsel at the time of the tape-
recorded conversations with Hurst. When the tape-recorded conversa-
tions occurred, however, Neely was represented by counsel on
charges of conspiracy to defraud the United States by interfering with
grand jury secrecy, see 18 U.S.C.A. § 371 (West 1966 & Supp. 1995),
obstruction of justice, see 18 U.S.C.A.§ 1503 (West Supp. 1995), and
criminal contempt, see 18 U.S.C.A. § 401(3) (West 1966).5 United
States v. Neely, 966 F.2d 1445 (4th Cir. 1992) (per curiam) (unpub-
lished), cert. denied, 113 S. Ct. 1261 (1993), but had not yet been
indicted on the instant charges. Hence, although any incriminating
statements made by Neely with respect to the pending charges would
have been inadmissible, any incriminating statements made by Neely
relating to allegations not yet charged would have been admissible
against Neely at a trial on those charges. See United States v.
DeVillio, 983 F.2d 1185, 1190-91 (2d Cir. 1993) (affirming admission
of incriminating statements related to uncharged offense that were
obtained after defendants had been indicted for another crime).
Indeed, DeVillio is particularly instructive in light of the fact that in
that case, the defendants made incriminating statements that related
to both charged and uncharged offenses during the course of a
covertly recorded conversation between the defendants and a codefen-
dant acting as a government informant. In holding that the statements
related to the uncharged crime were admissible, the Second Circuit
implicitly concluded that the inadmissibility of the statements related
to the charged offense did not taint statements regarding the
uncharged offense. See id. at 1191. Hence, for the Government to tape
record Hurst's conversations with Neely in an effort to obtain evi-
dence against Neely for use in prosecuting him on the instant charges
was not improper.6
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5 At the time of the recorded conversations, the district court had dis-
missed these charges, and the Government's appeal was pending before
this court.
6 Even if the Government's conduct had been improper, the impropri-
ety could not have denied Neely a fair trial because the district court
excluded from evidence the tape-recorded conversations.
8
Third, Neely posits that the Government deliberately misled the
district court and his attorneys respecting Kimbler's condition and
ability to travel. According to Neely, the Government claimed that
Kimbler was too ill to travel from a federal prison in Missouri to Roa-
noke, Virginia to be deposed; accordingly, Neely's attorneys travelled
to Missouri to take Kimbler's deposition. Upon arriving, they discov-
ered that Kimbler was to be transferred to a federal prison in Florida
for a hearing on a motion to be released from custody. In short, Neely
argues, the Government misled the district court and defense counsel
about the need to travel to Missouri. Of course, if Neely's allegations
are true, substantial questions are raised concerning the Government's
conduct, and, unfortunately, the Government does not dispute the fac-
tual basis of this claim. Nevertheless, even if we were to assume that
the Government acted improperly, we would not reverse Neely's con-
victions because Neely made no showing that the misconduct so prej-
udiced him as to deny him a fair trial. See Brockington, 849 F.2d at
875. Indeed, the fact that Kimbler was deposed by Neely's defense
counsel prior to trial indicates that any prosecutorial misconduct with
respect to representations about Kimbler's location and condition did
not deprive Neely of a fair trial.
B.
Neely also contends that the Government's repeated failure to turn
over exculpatory evidence was a part of a pattern of misconduct and
that this misconduct constituted a due process violation. Neely alleges
five instances of nondisclosure by the Government: (1) impeachment
evidence regarding Hurst's conviction for perjury, his use of narcot-
ics, and his illegal narcotics-dealing activities; (2) impeachment mate-
rials related to Kimbler, including a tape recording of a debriefing of
Kimbler by federal agents regarding Kimbler's participation in an
interstate drug ring; (3) impeachment materials relevant to the testi-
mony of Jamel Agemy, a Government witness; (4) information relat-
ing to the Government's seeking early release and a reduction in fine
for Giacolone in exchange for his testimony; and (5) information
regarding a statement by Gary Duncan, an individual on the Govern-
ment's witness list, that Duncan and Kimbler had not used drugs
together. We address these challenges in turn, keeping in mind that
a determination of whether the Government acted improperly neces-
sarily requires a determination of whether any Brady violation in fact
9
occurred; if there was no Brady violation, the Government's conduct
cannot be considered improper.
Brady v. Maryland, 373 U.S 83 (1963), and its progeny require that
the Government disclose to the defense all material evidence that is
favorable to the accused. This duty applies equally to evidence that
is directly exculpatory and to evidence that allows the defendant to
impeach a witness. See United States v. Bagley , 473 U.S. 667, 676
(1985). However, the Government has no duty to disclose evidence
that could have been discovered through the exercise of due diligence
by the defendant. See United States v. Wilson , 901 F.2d 378, 380 (4th
Cir. 1990). Thus, there is no Brady violation if "the exculpatory infor-
mation is not only available to the defendant but also lies in a source
where a reasonable defendant would have looked." Id. at 381.
Not every failure to disclose favorable information requires that the
defendant's conviction be vacated; rather, "the suppression by the
prosecution of evidence favorable to an accused . . . violates due pro-
cess [only] where the evidence is material either to guilt or to punish-
ment, irrespective of the good faith or bad faith of the prosecution."
Brady, 373 U.S. at 87. Evidence is material"if there is a reasonable
probability that, had the evidence been disclosed to the defense, the
result of the proceeding would have been different." Bagley, 473 U.S.
at 682. A "reasonable probability" of a different result exists "when
the Government's evidentiary suppression `undermines confidence in
the outcome of the trial.'" Kyles v. Whitley , 115 S. Ct. 1555, 1566
(1995) (quoting Bagley, 473 U.S. at 678).
With respect to Neely's first alleged instance of nondisclosure, we
note that this claim relates to the Government's failure to disclose evi-
dence that could be used to impeach Hurst during a hearing regarding
pre-trial detention. Brady, however, is concerned only with the ques-
tion of whether the defendant received a fair trial. Because Neely
does not claim that the Government failed to provide the information
in sufficient time for it to be used at trial, see United States v. Smith
Grading & Paving, Inc., 760 F.2d 527, 532 (4th Cir.), cert. denied,
474 U.S. 1005 (1985), we conclude that Neely's first allegation of
nondisclosure does not state a cognizable Brady claim.
Similar reasoning applies to Neely's second claim of nondisclo-
sure, which relates to the Government's alleged failure to provide,
10
prior to the taking of Kimbler's deposition, a tape recording of a
debriefing of Kimbler that revealed his involvement in an interstate
drug conspiracy and a murder-for-hire scheme. Even if Neely did not
receive the tape recording prior to Kimbler's deposition (a fact that
is not at all clear), the parties do not dispute that the recording was
provided to defense counsel well in advance of trial. As noted above,
the fact that Neely received the tape recording in time to use it at trial
precludes a Brady claim.
With respect to Neely's third allegation of nondisclosure, the dis-
trict court found that the Government's failure to disclose two investi-
gation reports containing information useful in impeaching Agemy
constituted a Brady violation and, accordingly, excluded Agemy's
testimony. Obviously, the fact that Agemy never testified precludes
a finding that the Brady violation related to Agemy's testimony
undermines confidence in the verdict.
Neely's fourth contention is that the Government failed to reveal
that Giacolone was promised early release from prison and a reduc-
tion in fine in exchange for his testimony. The Government argues
that this contention lacks a factual basis, claiming that Giacolone in
fact received only a two-week furlough so that he could help the Gov-
ernment prepare its case and that no agreement existed between the
Government and Giacolone regarding a reduction in Giacolone's fine.
Furthermore, the Government asserts, any promises made to Giaco-
lone could have been discovered through diligent cross-examination
of Giacolone. Because this information could have been discovered
through due diligence by defense counsel, the Government posits, it
had no duty under Brady to disclose it. We agree with the Govern-
ment that any promises actually made to Giacolone could have been
discovered by defense counsel during cross-examination. Addition-
ally, we note that Brady does not necessarily require that exculpatory
information be produced prior to trial; provided the information is dis-
covered in time for its effective use by the defense, there is no Brady
violation. See Smith Grading & Paving, 760 F.2d at 532 (holding that
disclosure of exculpatory evidence during cross-examination of first
Government witness did not violate Brady). Therefore, we conclude
that there is no Brady violation here because Neely himself, through
the exercise of due diligence, could have obtained information regard-
11
ing any promises made to Giacolone in time to use it effectively at
trial.
Finally, Neely claims that the Government violated Brady by con-
cealing a statement by Duncan that he had never used cocaine with
Kimbler. Neely argues that this statement would have allowed him to
impeach Kimbler's testimony. While this may or may not be true,
Neely cannot show that Duncan's statement was material to his
defense. Neely employed a host of impeachment material during his
cross-examination of Kimbler, most of it far more damning than Dun-
can's statement. Accordingly, we conclude that assuming the Govern-
ment was obligated to disclose Duncan's statement to the defense, the
failure to do so does not give rise to a reasonable probability that, had
the statement been disclosed, the outcome of the trial would have
been different.
III.
Second, Neely maintains that his convictions were obtained in vio-
lation of his Fifth Amendment right against compelled self-
incrimination. Specifically, Neely contends that he produced two sets
of documents pursuant to immunity orders and that the Government
violated those immunity orders by: (1) using documents to prepare its
case against Neely; (2) referring to Neely as the source of documents
before the grand jury; and (3) referring to Neely as the source of doc-
uments at trial. We conclude that none of these claims has merit.
The Fifth Amendment provides in part that no person"shall be
compelled in any criminal case to be a witness against himself." U.S.
Const. amend. V. The Supreme Court has held repeatedly that the
contents of voluntarily prepared business records are not protected by
the Fifth Amendment because, while possibly incriminating, their cre-
ation was not compelled. See, e.g., United States v. Doe, 465 U.S.
605, 610 (1984) ("[T]he Fifth Amendment protects the person assert-
ing the privilege only from compelled self-incrimination. Where the
preparation of business records is voluntary, no compulsion is pres-
ent." (citation & footnote omitted)); Fisher v. United States, 425 U.S.
391, 409 (1976) ("[T]he Fifth Amendment would not be violated by
the fact alone that [an accountant's workpapers] on their face might
incriminate the [defendant], for the privilege protects a person only
12
against being incriminated by his own compelled testimonial commu-
nications. . . . Furthermore, . . . the preparation of all of the papers
sought in these cases was wholly voluntary . . . ." (citations omitted)).
Whether the act of producing business records has independent tes-
timonial significance and may not be compelled absent a grant of
immunity coextensive with the privilege is, however, another ques-
tion. Thus, even though the contents of business records are not pro-
tected,
"[t]he act of producing evidence in response to a subpoena
nevertheless has communicative aspects of its own, wholly
aside from the contents of the papers produced. Compliance
with the subpoena tacitly concedes the existence of the
papers demanded and their possession or control by the
[defendant]. It would also indicate the [defendant's] belief
that the papers are those described in the subpoena. The ele-
ments of compulsion are clearly present, but the more diffi-
cult issues are whether the tacit averments of the[defendant]
are both `testimonial' and `incriminating' for purposes of
applying the Fifth Amendment. These questions perhaps do
not lend themselves to categorical answers; their resolution
may instead depend on the facts and circumstances of par-
ticular cases or classes thereof."
Braswell v. United States, 487 U.S. 99, 103 (1988) (quoting Fisher,
425 U.S. at 410) (citation omitted). According to the Braswell court,
the custodian of corporate records does not possess a Fifth Amend-
ment privilege against the production of those records, because he
holds those records only as a representative of the organization. See
id. at 104. However, in the case of a sole proprietorship, Braswell
holds that, under Doe, the custodian of the records must "be provided
the opportunity to show that his act of production would entail testi-
monial self-incrimination." Id. If the custodian makes such a showing,
the Government cannot compel production of the records unless it
first grants the custodian immunity coextensive with the scope of the
privilege. See Kastigar v. United States, 406 U.S. 441, 449 (1972).
The district court's conclusion with respect to whether an individual
is entitled to immunity for his act of producing business records is a
13
finding of fact that we may overturn only if it is unsupported by the
record. See Doe, 465 U.S. at 613-14.
In December 1990, the grand jury issued a subpoena addressed to
"ROBERT KEITH NEELY, ESQ., Custodian of Records for sole
practice law firm" requesting "ANY AND ALL client related records
and documents . . . relative to Michael Giacolone, Jamel Agemy,
James Regan for the period 1980 to September 1990." (J.A. at 508,
510) (Document Set One.) Neely moved to quash the subpoena, argu-
ing that the documents were protected by attorney-client privilege and
that being required to produce the records would violate his Fifth
Amendment right against compelled self-incrimination. After the dis-
trict court granted the motion to quash, Neely agreed to produce the
documents pursuant to a grant of immunity. Thereafter, at the Gov-
ernment's request, the district court entered an order granting Neely
immunity for "testimony or . . . other information which he refuses
to give or to provide on the basis of his privilege against self incrimi-
nation." (J.A. at 543-44.) Neely then produced the documents.
In May 1991, the grand jury served another subpoena, addressed
to "Keith Neely, Custodian of Records, R. Keith Neely, P.C.," seek-
ing "ANY AND ALL records, files, [etc.] . .. maintained by the
R. Keith Neely law firm" related to the purchase of the Claytor Lake
property and to Kimbler, Hurst, and Franklin. (J.A. at 1151, 1153)
(Document Set Two.) Neely moved to quash this subpoena; in
response, the Government moved for an order of act-of-production
immunity. After examining the subpoenaed documents in camera, the
district court granted in part Neely's motion to quash. The district
court held that some of the documents were subject to attorney-client
privilege and that the compulsory production of others would violate
Neely's right against compelled self-incrimination. With respect to
the rest, the district court concluded that the documents were corpo-
rate papers not protected by the Fifth Amendment. 7 Neely subse-
_________________________________________________________________
7 The district court's rulings with respect to the two sets of documents
leave some question as to whether it viewed R. Keith Neely, P.C. as a
sole proprietorship or as a corporation. We need not resolve this ambigu-
ity because the contents of the subpoenaed documents were not privi-
leged under either characterization and because we conclude that,
assuming Neely's act of producing the documents was protected by a
Fifth-Amendment privilege, any reference to Neely as the source of the
documents was harmless beyond a reasonable doubt.
14
quently produced these documents.8
Neely argues that the district court granted him use immunity for
the contents of Document Set One, and therefore claims that the Gov-
ernment violated his right against compelled self-incrimination in
showing the documents to two witnesses, Giacolone and Tangie Vest,
a former employee of Neely's, to help the Government prepare for
trial. In response, the Government argues first, that the order grants
Neely only act-of-production immunity, and second, that even if the
order did grant use immunity, the documents are corporate records
and therefore not protected by the Fifth Amendment. After a lengthy
hearing on this issue, the district court found that Neely "would enjoy
immunity as to any act of production, but not as to the contents of the
documents produced. While the order granting immunity was broad
enough to cover any activity or testimony of the defendant, the evi-
dence shows that the only testimonial act the defendant performed
was producing the records." (J.A. at 663.)
We cannot conclude that the district court's finding that Neely's
only testimonial act was the production of Document Set One is
clearly erroneous. See Doe, 465 U.S. at 613-14. The subpoena clearly
sought business records of the law firm, and Neely does not dispute
that those records were created voluntarily. Accordingly, Neely pos-
sessed no Fifth Amendment right with respect to the contents of those
documents. See id. at 610. And, given that Neely operated his law
firm as a sole practitioner, the district court's finding that Neely was
entitled to immunity for his act of producing the documents is not
clearly erroneous. Thus, although the Government was barred from
using Neely's act of producing Document Set One against him, it was
free to use the contents of Document Set One to prepare its case
against Neely.9
_________________________________________________________________
8 We can find no support in the record for Neely's assertion that the
district court granted the Government's motion for act-of-production
immunity. The document to which Neely points, (see J.A. at 562-63), is
simply a draft order submitted by the Government with its motion. The
draft order was never signed by the district court.
9 Neely argues that, having granted him use immunity, the Government
was required to show that none of the evidence offered against Neely at
15
The district court's finding that Neely was entitled to immunity for
his act of producing Document Set One necessarily means that Agent
Higginbotham acted improperly when he referred to Neely as the
source of Document Set One before the grand jury that received those
documents. Indeed, the Government does not dispute that Agent Hig-
ginbotham's comments violated Neely's Fifth Amendment right.
Rather, the Government contends that the violation was harmless
beyond a reasonable doubt and reversal of Neely's convictions there-
fore is not required. See United States v. Harris, 973 F.2d 333, 338
(4th Cir. 1992) (noting that use of compelled testimony does not
require reversal if error is harmless beyond a reasonable doubt). In
advancing this contention, the Government rightly points out that, in
addition to the fact that the Government reminded the grand jury that
it was not to consider that Neely had produced the documents, the
grand jury that indicted Neely was not the same grand jury that
received the records, and no improper references were made to Neely
as the source of Document Set One before the grand jury that actually
indicted him. Under these circumstances, we conclude that neither
Neely's indictment nor his trial suffered even the slightest taint from
the improper references and that the error was harmless beyond a rea-
sonable doubt.
Neely also contends that reversal of his convictions is required
because IRS Agent Suzanne Hines, who testified at trial regarding
various financial records including several checks that had been pro-
duced pursuant to one of the grand jury subpoenas, referred to "the
defense" as the source of the checks. (J.A. at 871WW.) According to
Neely, Hines's statement requires reversal of his convictions because
it referred to Neely's testimonial act of producing the documents,
thereby violating his right against compelled self-incrimination. The
Government concedes that Hines's statement constituted error but
maintains that the district court correctly determined that this error
was harmless beyond a reasonable doubt.
_________________________________________________________________
trial was derived from the contents of Document Set One. See Kastigar,
406 U.S. at 460. Because the documents were not privileged, however,
there was no prohibition against the Government using them to prepare
its case against Neely. Neely's claim that the Government failed to meet
its burden under Kastigar is therefore misplaced.
16
In concluding that Hines's reference to Neely as the source of doc-
uments was harmless beyond a reasonable doubt, the district court
employed the test of Williams v. Zahradnick, 632 F.2d 353, 361-62
(4th Cir. 1980). Under Williams, the determination of whether an
error is harmless beyond a reasonable doubt depends on five factors:
(1) the use to which the Government put the improper reference; (2)
"[w]ho elected to pursue the line of questioning"; (3) "[t]he quantum
of other evidence indicative of guilt"; (4) "[t]he intensity and fre-
quency of the reference"; and (5) "[t]he availability to the trial judge
of an opportunity to grant a motion for mistrial or to give curative
instructions." Id. The district court concluded that none of these fac-
tors weighed in favor of reversal, noting that the reference was brief,
equivocal, and inadvertent; that the evidence of Neely's guilt was
substantial; and that the court had considered and rejected the options
of a mistrial or a curative instruction.10 The district court was in the
best position to observe the impact of Agent Hines's remark in the
context of the trial as a whole. Hence, we are reluctant to disturb the
district court's carefully considered ruling that the error was harmless
beyond a reasonable doubt. Moreover, our review of the record leaves
us with no doubt as to the fleeting nature of the reference and its mini-
mal significance when considered in light of all of the evidence pres-
ented during the lengthy trial. We therefore agree with the district
court that this error does not warrant reversal because it was harmless
beyond a reasonable doubt.
IV.
Next, Neely mounts a Sixth Amendment challenge to his convic-
tions. Specifically, he posits that he was deprived of his Sixth Amend-
ment right to counsel because the Government knowingly allowed his
former attorney to represent one of the Government's witnesses on
charges unrelated to the investigation of Neely. According to Neely,
the Government failed to disclose to the district court a known con-
flict of interest, thereby resulting in Neely's being represented by
counsel with an actual conflict of interest. Neely asserts that this vio-
_________________________________________________________________
10 The district court stated that it elected not to give a curative instruc-
tion because it feared that the cure would be worse than the disease, i.e.,
that the curative instruction would draw more attention to the error than
it warranted.
17
lation of his Sixth Amendment right to counsel entitles him to a new
trial.
The district court held a lengthy hearing on Neely's Sixth Amend-
ment claim, at which the following facts were adduced. The Govern-
ment's investigation of Neely, led by FBI Agent Gerald Fayed and
IRS Agent Hines, began sometime in the late 1980s. In 1990, Neely
pleaded guilty to misdemeanor cocaine possession. Neely was repre-
sented in the case by his friend Turk. Neely was placed on probation
after his guilty plea; at this point Turk believed that his representation
of Neely had ended.
In March 1992, Neely contacted Turk and requested that Turk rep-
resent Hurst, who had been charged with money laundering and
released on bond. Turk undertook the representation only after being
assured by both Neely and Hurst that no conflict of interest existed.
At approximately the same time, Turk made several inquiries to the
court and to the probation office regarding the possibility of an early
release from probation for Neely. Turk avowed that he made the
inquiries as a favor to Neely, not as his counsel, emphasizing to the
district court that he informed Neely that he was not representing
Neely at that time. Turk's last activity regarding Neely's probation
status occurred on April 15, 1992.
Shortly after he agreed to represent Hurst, the Government
informed Turk of its belief that Hurst, Neely, and Kimbler had partici-
pated jointly in drug-related activities and offered the possibility of a
reduced sentence for Hurst if he agreed to testify against Neely. Addi-
tionally, Turk reviewed discovery material in the Government's pos-
session and found an affidavit by Kimbler indicating that Hurst and
Neely might be linked to drug trafficking. In response to Turk's
inquiry, Hurst stated that he did not want to testify against Neely, but
did not admit or deny the truth of the Government's allegations
regarding his association with Neely. According to Turk, Neely
repeatedly contacted him regarding the Hurst case, making inquiries
and suggesting strategies in a manner that made Turk suspect that
"Neely was trying to manipulate Hurst's defense in order to protect
himself." (J.A. at 1358.)
On May 12, 1992, the Government moved to revoke Hurst's bond
on the basis of a urinalysis that tested positive for cocaine use. Hurst
18
informed Turk that Neely gave him the cocaine that had resulted in
the positive urinalysis and told Turk that he now wished to testify
against Neely. At that point, Turk informed Hurst that he could no
longer serve as his attorney and advised him to seek new counsel.
Before officially withdrawing as counsel, however, Turk attended a
meeting between Hurst and the Government to negotiate a plea agree-
ment. After the meeting, Hurst met with Government investigators
several more times and met with Neely while wearing a recording
device. Turk stated that he had no specific knowledge of these activi-
ties and that he did not provide Hurst with any legal advice regarding
them. Turk was present at Hurst's plea hearing because Hurst's sub-
stitute counsel was unavailable. At that time, Turk informed the court
of the conflict and formally withdrew as counsel.
Prior to trial, Neely moved to suppress Hurst's testimony on the
basis that Turk's simultaneous representation of Hurst (on money
laundering charges unrelated to Neely) and Neely (on early release
from probation) violated Neely's right to counsel in this case. The dis-
trict court held a lengthy hearing at which Turk and others testified.
Ruling from the bench, the district court concluded that, regardless of
Turk's view that he was not "representing" Neely with respect to
Neely's probation status, Turk remained Neely's counsel throughout
Turk's representation of Hurst. The court also opined, however, that
Neely's Sixth Amendment right with respect to the instant charges
was not implicated by the dual representation because Neely had not
yet been indicted. Additionally, the district court held that any preju-
dice to Neely from the dual representation affected only Neely's pos-
sible early release from probation, not the pending charges.
That a defendant's Sixth Amendment right to counsel includes the
right to counsel free from serious conflicts of interest is beyond ques-
tion. See Hoffman, 903 F.2d at 285. A defendant's right to counsel has
been violated when an "actual conflict of interest adversely affect[s]
his lawyer's performance." Id. at 286 (internal quotation marks omit-
ted). Such a conflict exists when an attorney simultaneously repre-
sents two individuals whose interests are adverse. See id. at 285.
Neely's Sixth Amendment claim is patently without merit. Assum-
ing that Turk labored under an actual conflict of interest in his simul-
taneous representation of Hurst and Neely, this conflict related only
19
to Turk's representation of Neely on the cocaine-possession matter.
Because Turk did not represent Neely on the instant charges --
indeed, the conflict was resolved before Neely was even indicted on
these charges -- Neely was not represented by counsel laboring under
an actual conflict of interest, and could not have suffered a depriva-
tion of his right to counsel.
V.
Neely further contends that the Government abused the grand jury
process by commencing a grand jury investigation of Franklin before
Neely's trial took place. According to Neely, the investigation of
Franklin was a mere pretext for the Government's real purpose,
namely acquiring more evidence against Neely. The Government
counters that its investigation of Franklin was legitimate. We find
Neely's claim to be without merit.
A court should not intervene in the grand jury process absent a
compelling reason. See United States v. Dionisio , 410 U.S. 1, 16-18
(1973). A presumption of regularity attaches to grand jury proceed-
ings, and Neely has the burden of showing that this presumption is
unwarranted. See United States v. Moss, 756 F.2d 329, 332 (4th Cir.
1985). While the Government may not utilize a grand jury "solely or
even primarily for the purpose of gathering evidence in pending liti-
gation," id., the existence of a pending indictment does not preclude
the Government from using a grand jury to make a good-faith inquiry
into charges not included in the indictment, id. Provided investigation
of the defendant is not the Government's "sole or dominant purpose"
in convening the grand jury, no abuse of the grand jury process has
occurred. Id. The advantage of this rule is that it allows grand juries
to conduct continuing investigations without waiting to indict persons
against whom sufficient evidence to indict has been obtained:
Lacking clairvoyance, grand juries must be allowed to
investigate freely individuals suspected of involvement in
crimes for which indictments have already been issued.
When applied correctly, the sole or dominant purpose test
plainly permits grand juries to investigate additional individ-
uals who become suspects only after an indictment has been
20
returned, while precluding improper use of the grand jury
for discovery.
Id. The district court's determination regarding the Government's sole
or dominant purpose in conducting a grand jury investigation is a fac-
tual finding, which we review only for clear error. Id.Franklin was named, but not indicted, in the indictment charging
Neely. After the indictment was returned, but before Neely's trial, a
grand jury was convened to investigate Franklin on charges unrelated
to the Neely indictment. Immediately upon learning of the investiga-
tion, Neely filed an emergency motion to enjoin the grand jury pro-
ceedings. The district court held an emergency hearing on Neely's
motion, during which Neely asserted his belief that the investigation
of Franklin was being used as a discovery device in the Government's
case against Neely. In response, the Government proffered, under
seal, its reasons for investigating Franklin. Agent Fayed testified that
the grand jury's investigation of Franklin was related to Franklin's
suspected distribution of marijuana and cocaine and that the Govern-
ment had proceeded with its investigation of Franklin because its key
witness, Kimbler, was suffering from terminal cancer, making it nec-
essary to secure his testimony for trial in the form of a videotaped
deposition. The Government, therefore, had to determine whether
there was sufficient evidence against Franklin to indict him so that he
could be present during the deposition.
Based on this information, the district court concluded that the
Government's investigation of Franklin was conducted in good faith,
and that the investigation was not being carried out for the sole or
dominant purpose of acquiring evidence against Neely. We cannot
say that this finding was clearly erroneous, and accordingly, decline
to reverse Neely's convictions on this basis.
VI.
Neely next maintains that the district court committed reversible
error by allowing the Government to designate two case agents,
Agents Fayed and Hines, both of whom were exempted from the
21
district court's order sequestering witnesses. See Fed. R. Evid. 615.11
While we agree with Neely that an error was committed, we find the
error harmless.
Rule 615 provides for the exclusion of witnesses at the request of
a party. Exclusion is a matter of right; once a request is made, the
court "shall" sequester the witnesses. Id. ; see United States v.
Farnham, 791 F.2d 331, 334-35 (4th Cir. 1986). Rule 615 is designed
to aid the truth-seeking process by denying the opportunity for wit-
nesses to collude or for one witness to tailor his testimony to the testi-
mony of another. See id. at 334-35. Every witness need not be
excluded, however. Rule 615 exempts from sequestration: (1) a party
who is a natural person; (2) a designated representative of a party that
is not a natural person; and (3) a person whose presence is essential
to the presentation of the case. Fed. R. Evid. 615. That the Govern-
ment's investigating agent may be exempted from sequestration pur-
suant to Rule 615(2) is beyond dispute, see United States v. Parodi,
703 F.2d 768, 773 (4th Cir. 1983); that the Government may desig-
nate only one such agent is equally clear. Farnham, 791 F.2d at 335.
The Government erroneously relies on United States v. Kosko, 870
F.2d 162, 164 (4th Cir.), cert. denied, 491 U.S. 909 (1989), for the
proposition that "a district court may permit two case agents to remain
in the courtroom if their testimony does not overlap and undermine
the integrity of the fact-finding process." (Appellee's Brief at 35.) In
Kosko, we affirmed the district court's ruling allowing a DEA agent
and an IRS agent, both of whom had participated in the investigation
of the defendant, to remain in the courtroom during trial because the
latter agent was present in the courtroom as an expert witness whose
presence was essential to the presentation of the Government's case.
_________________________________________________________________
11 Rule 615 provides:
At the request of a party the court shall order witnesses
excluded so that they cannot hear the testimony of other wit-
nesses, and it may make the order of its own motion. This rule
does not authorize exclusion of (1) a party who is a natural per-
son, or (2) an officer or employee of a party which is not a natu-
ral person designated as its representative by its attorney, or (3)
a person whose presence is shown by a party to be essential to
the presentation of the party's cause.
22
Kosko, 870 F.2d at 164; see Fed. R. Evid. 615(3). Indeed, Kosko
explicitly reaffirmed the holding of Farnham that the Government
may designate only one case agent as its representative. Kosko, 870
F.2d at 164. Regardless of the wisdom of the Government's position
that a district court may designate more than one case agent when
each agent represents a different governmental agency and their trial
testimony will not overlap, we are bound by Farnham and Kosko to
reject it.
In short, the district court erred in permitting the Government to
designate two case agents, both of whom were exempted from the
sequestration order and both of whom testified at Neely's trial. The
question remains, however, whether this error requires us to reverse
some or all of Neely's convictions. See Farnham , 791 F.2d at 335(holding that a violation of Rule 615 does not require vacatur of con-
victions if the error was harmless). Although both agents testified dur-
ing the trial, their testimony concerned entirely different matters:
Agent Fayed's testimony concerned Neely's telephone records, while
Agent Hines testified regarding Neely's financial records. Cf. Kosko,
870 F.2d at 164 (concluding that because "the testimony of the two
agents did not overlap as to any matter on which they had personal
knowledge, . . . their mutual presence during trial could not have
undermined the integrity of the fact-finding process"); Farnham, 791
F.2d at 334 (finding violation of Rule 615 not harmless when two
agents testified regarding their personal knowledge of the same
events). We therefore conclude that the error was harmless.
VII.
Finally, Neely contends that his convictions for conspiracy to pos-
sess cocaine for personal use (Count Two) and aiding and abetting the
distribution of cocaine (Count Three) are mutually exclusive, thereby
requiring reversal of Count Three, the more serious crime. Specifi-
cally, Neely claims that the affirmative finding of intent required for
a conviction on the possession count -- i.e., the intent to possess
cocaine -- necessarily precludes an affirmative finding of the intent
required for conviction on the aiding and abetting count -- i.e., the
intent to distribute cocaine -- because one cannot intend simulta-
neously to possess something and to distribute it.
23
We are not persuaded by this argument. There was ample evidence
from which the jury could conclude that Neely conspired with other
individuals to obtain cocaine for his personal use while simulta-
neously aiding and abetting Kimbler in his distribution activities. At
most, the jury's verdicts on these counts are inconsistent, but this does
not entitle Neely to an acquittal on Count Three. See United States v.
Powell, 469 U.S. 57, 63 (1984); see also United States v. Arrington,
719 F.2d 701, 705 (4th Cir. 1983) (concluding that acquittal on con-
spiracy charge is not a valid basis for reversal of conviction on charge
of aiding and abetting), cert. denied, 465 U.S. 1028 (1984).
VIII.
We have reviewed carefully all of Neely's assignments of error and
conclude that none of them warrants reversal of his convictions.
Accordingly, Neely's convictions are affirmed.
AFFIRMED
24