Friday, November 10th, 2017

Second Circuit Preserves Ban On Compelled Cross-Border Testimony

Yesterday the Second Circuit denied rehearing en banc of a case that places an important constraint on cross-border prosecutions. United States v. Allen, No. 16-898 (Cabranes, Pooler, Lynch), available here. As we previously wrote, the 81-page opinion in Allen holds that the Fifth Amendment prohibits the use of testimony in a U.S. criminal prosecution that was compelled by a foreign sovereign. This post elaborates on the substance and implications of this decision.

Allen involved a cooperative investigation by U.S. law enforcement and the U.K’s Financial Conduct Authority (FCA) into the LIBOR scandal. The FCA required the Allen defendants to be interviewed under oath. Had they refused, they would have risked imprisonment. (The FCA granted the defendants “direct use” immunity, but not “derivative use” immunity as is required if a witness is compelled to testify in the United States). The FCA subsequently brought an enforcement action against Paul Robson, a coworker who was implicated by the defendants’ testimony and who later became a cooperating witness for the U.S. government. The FCA disclosed the Allen defendants’ testimony to Robson during discovery, and Robson closely reviewed that testimony. In the U.S. criminal trial, Judge Rakoff permitted Robson to testify on topics that had antecedents in the defendants’ testimony before the FCA.

The Second Circuit held that this indirect admission of the defendants’ compelled testimony violated the Fifth Amendment’s self-incrimination clause. The temporal scope of the right self-incrimination was central to the court’s analysis. The Fifth Amendment protects against the admission of compelled statements at trial, and is thus violated at the time those statements are admitted in court. (The core self-incrimination right thus differs from rights under the Fourth Amendment and Miranda, neither of which apply to the extraterritorial conduct of foreign law enforcement officials.) Because it guards a trial right, the Fifth Amendment forbids the use of compelled testimony to secure a criminal conviction in U.S. courts, regardless of the nationality of the government official that did the compelling. Having determined that the Fifth Amendment applies in this case, the court concluded that the government failed to bear its “heavy burden” of proving that Robson’s testimony “was derived from legitimate independent sources.” Slip op. at 57-58 (quoting Kastigar v. United States, 406 U.S. 441, 461-62 (1972)).

The court acknowledged the government’s anxiety that this holding would “seriously hamper” prosecutions involving cooperative, cross-border investigation. Id. at 47. Far more troubling, however, was the government’s position that, in cross-border prosecutions, the Fifth Amendment places no constraints on using defendants’ own compelled statements to prosecute them. See 51. As the court observed, the U.S. government’s cooperative enforcement practices have developed to the point where U.S. prosecutors are frequently embedded in foreign law enforcmeent agencies, including the U.K. FCA. See id. at 53. Given this reality, “[o]ne area where intimate cooperation will be needed between U.S. prosecutors and foreign authorities (or, perhaps, between U.S. prosecutors and U.S. prosecutors on detail to foreign authorities) is securing witness testimony.” Id. at 54.

The significance of Allen‘s holding is obvious, but its scope remains up for grabs. Notably, the court distinguished the Allen defendants’ compelled testimony from statements the government obtained from the defendant in United States v. Salameh, 152 F.3d 88 (2d Cir. 1998), after he had been tortured in an Egyptian prison. The court reasoned that, unlike the compelled interviews with U.K. officials in Allen, the “relevant interrogation” in Salmeh occurred when the defendant was in U.S. custody. See slip op. at 41 n.89.

It is clear that Allen applies beyond the white collar context. However, to extend Allen to where the constitutional threats are most urgent—where U.S. prosecutors rely on evidence extracted by foreign officials through torture—attorneys must develop their records carefully. If an attorney can link a defendant’s compelled statements at the hands of foreign official to the investigative strategies of an U.S. official, then Salmeh is unlikely to provide a refuge for prosecutors.


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