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United States v. Kipp

United States District Court, W.D. North Carolina, Charlotte Division

January 31, 2017



          Max O. Cogburn Jr. United States District Judge

         THIS MATTER is before the court on review of non-dispositive Orders issued by Honorable David S. Cayer, United States Magistrate Judge, in this matter. Defendants have filed Objections (#s 134 and 135) to such Order and the government has filed timely Responses (#s139 and 140).


         I. Applicable Standard

         The district court has authority to assign non-dispositive pretrial matters pending before the court to a magistrate judge to “hear and determine.” 28 U.S.C. § 636(b)(1)(A). When reviewing an objection to a magistrate judge's order on a non-dispositive matter, the district court must set aside or modify any portion of that order which is clearly erroneous or contrary to law. Fed.R.Crim.P. 59(a). To show that a magistrate judge's order is contrary to law, the objecting party must show that the magistrate judge failed to apply or misapplied statutes, case law, or procedural rules. See Catskill Dev. LLC v. Park Place Entm't Corp., 206 F.R.D. 78, 86 (S.D.N.Y.2002).

         The court has carefully reviewed the Orders as well as the objection, and has determined that the Orders of the magistrate judge are fully consistent with and supported by current law. Based on such determination, the court will overrule the Objections and fully affirm the Order for the reasons discussed in the government's Responses, and for the reasons briefly discussed herein.

         II. Discussion

         A. Order denying joint Motion to Compel

         As to Judge Cayer's Order (#122) denying defendants' joint Motion to Compel (#s 98 and 99), defendants sought documents and information detailing negotiations the government had with Swisher concerning the Deferred Prosecution Agreement (hereinafter “DPA”), the related Bill of Information, any facts in the pending Indictment, any proffers made by Swisher, and any agent's rough notes. Judge Cayer denied such request.

         First noting the correct standard of materiality under Rule 16, Fed.R.Crim.P., and correctly identifying defendants' burden on such motion, Judge Cayer's concluded that defendants' “assertion that ‘Swisher may not have always been in agreement with the Government' does not suffice” (Order (#122) at 4) and did not satisfy defendants' burden under Rule 16. Such determination is not clearly erroneous.

         Judge Cayer also properly concluded that this court's Standing Discovery Order provides that the government need not retain agents' rough notes where those notes are incorporated into a formal report. Further, Judge Cayer accurately recognized that the government stated that it has and will continue to provide defendants with all materials falling within Brady and Giglio, and properly concluded that mere speculation that more material might exist does not satisfy the defendant's burden in moving to compel. More particularly, Judge Cayer correctly found that communications between the government and Swisher, years after the criminal conduct alleged herein occurred, were not discoverable as defendants had not met their burden of showing how such materials would be material to preparing a defense. United States v. Caro, 597 F.3d 608, 621-22 (4th Cir. 2010).

         Finally, defendants' reliance on United States v. Stein, 488 F.Supp.2d 350 (S.D.N.Y. 2007) is misplaced. First, Stein, as a district court decision from another circuit, is not controlling. Second, the situation in Stein is dissimilar to this case inasmuch as the party with the DPA there did not, as has Swisher in this case, cooperated in the government's investigation. Indeed, it is alleged herein that Swisher sponsored an internal investigation upon learning of the alleged accounting fraud by these defendants and took steps to inform the investing public of what it determined was likely fraud. Thus, Judge Cayer was under no obligation to follow the decision in Stein. Third, the court can find no support for defendants' argument that it was error for the magistrate judge not to engage in an inquiry as to whether the documents sought were in the government's control. Clearly, defendants' inability to show materiality at the first step of the analysis mooted the need for any inquiry into control.

         Defendants' Objections to this determination are overruled, the Order of Judge Cayer is fully affirmed, and the court adopts such Order as its own.

         B. Order denying Defendant Viard's ...

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