and money laundering investigations, Tr. 971 F.2d at 856, in this case the "precipitating fact" that led the government to delve into defendant's tax activity was Eng's purchase of a building at 26 Bowery on behalf of a corporation over which he presided. Tr. at 78-79. IRS Special Agent Thomas Interdonato, assigned to the DEA Southeast Asian Task Force, discovered Eng's purchase of this property through an examination of public records in the summer of 1989; Interdonato thereafter took primary responsibility for the tax investigation. Tr. at 78-79.
In conducting this tax evasion investigation of Shu Yan Eng, Interdonato used the "tax expenditures" method of proof, which essentially compares the taxpayer's income and non-taxable resources, such as gifts and loans, with the taxpayer's expenditures. Tr. at 3-4. In order to prove tax evasion by this indirect method, the government must show to a "reasonable probability" that non-taxable sources of funds spent by the taxpayer did not exist, a burden that involves a "thorough search of assets, sources of money, and cash inflows and outflows." Eng,, 971 F.2d at 856 (citing United States v. Bianco, 534 F.2d 501 (2d Cir.), cert. denied, 429 U.S. 822, 50 L. Ed. 2d 84, 97 S. Ct. 73 (1976)). The materials that Interdonato gathered in connection with the initial phase of his investigation are discussed in detail below.
On October 18, 1989, Eng was arrested pursuant to a grand jury indictment charging him with administration of a continuing criminal enterprise, money laundering, and various narcotics violations. Lawfully seized from Eng's person at the time of his arrest were American Express Cards, three vehicle registrations, a social security card, a life insurance card, a driver's license, and several business cards. Tr. at 177; GX 357. In addition, on the day of defendant's arrest, law enforcement authorities took possession of two of his business properties: the 26 Bowery building, mentioned above as the impetus for the tax investigation, and the French Ice Cream Parlor. A search of Eng's personal safe in the French Ice cream parlor ensued, and a variety of materials -- also discussed below -- were seized from that safe. The government concedes that the search and seizure of the safe were conducted without a warrant and were thus unlawful. Tr. at 184.
In April of 1990, approximately six months after the illegal search and eight months after Interdonato's tax evasion investigation commenced, a superseding indictment was handed up. That indictment added to the existing charges against Eng three tax evasion counts relating to the tax years 1986 through 1988. Eng then moved to suppress various financial documents seized in the search of the French Ice Cream Parlor safe and evidence allegedly derived from the seized materials, contending that this evidence was tainted by the illegal search and therefore could not be admitted at trial to support the tax evasion counts. After holding a suppression hearing, at which Agent Interdonato was the only witness, reading the parties' briefs and proposed findings of fact, and examining Nix v. Williams and its progeny, this court determined that the government had met its burden of proof under the "inevitable discovery" doctrine by demonstrating that it was more likely than not that the government would have discovered the challenged evidence even absent the illegal search. Defendant's motion to suppress was therefore denied, and, as expected, the government introduced many of the challenged documents into evidence at Eng's trial.
In April of 1991, a jury convicted Eng on all three tax evasion charges but acquitted him on all other counts. Eng thereafter appealed this court's suppression ruling to the Second Circuit which, as already mentioned, vacated the determination that the inevitable discovery doctrine applied generally to all the seized evidence and remanded the case for particularized findings of fact. The remainder of this opinion complies with that remand as follows: first, it discusses the relevant "inevitable discovery" law in the Second Circuit; second, it explains how the inevitable discovery doctrine relates to the particular investigation against Eng; third, it describes the evidence that the government presented at trial to support Eng's conviction on tax evasion; and fourth, it analyzes in detail each of the challenged pieces of evidence -- in accordance with the Second Circuit's mandate -- to explain why the majority of that evidence falls within the inevitable discovery exception to the exclusionary rule.
I. The Inevitable Discovery Doctrine
A. Nix v. Williams
"The exclusionary rule prohibits introduction into evidence of tangible materials seized during an unlawful search, Weeks v. United States, 232 U.S. 383, 58 L. Ed. 652, 34 S. Ct. 341 (1914), and of testimony concerning knowledge acquired during an unlawful search, Silverman v. United States, 365 U.S. 505, 5 L. Ed. 2d 734, 81 S. Ct. 679 (1961)." Murray v. United States, 487 U.S. 533, 536, 101 L. Ed. 2d 472, 108 S. Ct. 2529 (1988). In the oft-quoted words of Wong Sun v. United States, 371 U.S. 471, 484-84, 9 L. Ed. 2d 441, 83 S. Ct. 407 (1963), the exclusionary rule also bars introduction of derivative evidence -- "fruit of the poisonous tree" -- unless the relationship between that evidence and the search is sufficiently attenuated:
We need not hold that all evidence is "fruit of the poisonous tree" simply because it would not have come to light but for the illegal actions of the police. Rather, the more apt question in such a case is "whether, granting establishment of the primary illegality, the evidence to which instant objection is made has been come at by exploitation of that illegality or instead by means sufficiently distinguishable to be purged of the primary taint." Maguire, Evidence of Guilt, 221 (1959).
Id. at 487-88. The rationale of the inevitable discovery doctrine evolved from this quotation. See Nix v. Williams, 467 U.S. 431, 441-43, 81 L. Ed. 2d 377, 104 S. Ct. 2501 (1984); see also United States v. Alvarez-Porras, 643 F.2d 54, 59 (2d Cir.) (citing language from Wong Sun and explaining that "in applying the exclusionary rule, a trial court must focus on the existence of 'exploitation' of the 'primary illegality.' 'The primary issue [is] whether the unlawful police behavior bore a causal relationship to the acquisition of the challenged testimony.' . . . Even if 'the challenged evidence was acquired by the police after some initial Fourth Amendment violation, . . . the question before the court is whether the chain of causation proceeding from the unlawful conduct has become so attenuated or has been interrupted by some intervening circumstance so as to remove the "taint" imposed upon that evidence by the original illegality.'") (citations omitted) (emphasis in original), cert. denied, 454 U.S. 839 (1981); United States v. Falley, 489 F.2d 33, 40-41 (2d Cir. 1973) (citing language from Wong Sun to hold "it would have been only a question of time before the government by a so-called saturation investigation, or otherwise, would have discovered the . . . documents. Even if the address book had shortened or facilitated the investigation it did not supply fruit sufficiently poisonous to be fatal.").
The inevitable discovery exception to the exclusionary rule allows admission of unlawfully obtained evidence at trial when the government demonstrates that discovery of that evidence by legitimate means was "inevitable." Nix, 467 U.S. at 444; United States v. Gorski, 852 F.2d 692, 695 (2d Cir. 1988). Illustration of what has been deemed "inevitable" is essential to comprehending and applying the doctrine. In the seminal Supreme Court case on inevitable discovery, Nix v. Williams, police officers elicited incriminating statements from the defendant which, in turn, led them to the body of his murder victim, a ten-year-old girl named Pamela Powers. Although an earlier Supreme Court appeal found the defendant's admissions to be the product of unconstitutional custodial interrogation, the Nix Court nevertheless held that evidence of the location and condition of the girl's body was properly admitted at defendant's retrial. Id. at 449-50. The basis for this holding was the Court's conclusion that police "inevitably" or "ultimately" would have discovered the victim's body even absent the unconstitutional conduct: a search had been in progress and was suspended only when defendant agreed to cooperate; the area was systematically divided or intended to be divided; and search-team members were three to five hours from the body's location when the search was suspended. Id. at 448-49.
The Nix Court explained the rationale underlying the inevitable discovery doctrine as follows:
The interest of society in deterring unlawful police conduct and the public interest in having juries receive all probative evidence of a crime are properly balanced by putting the police in the same, not a worse, position than they would have been in if no police error or misconduct had occurred.
Id. at 443-44 (emphasis in original). In other words, "the purpose of the inevitable discovery rule is to block setting aside convictions that would have been obtained without police misconduct." Id. at 443 n.4. Relying on the observation that "inevitable discovery involves no speculative elements but focuses on demonstrated historical facts capable of ready verification or impeachment," and declining "to impose added burdens on the already difficult task of proving guilt in criminal cases by enlarging the barrier to placing evidence of unquestioned truth before juries," the Nix Court rejected defendant's argument that the clear-and-convincing evidence standard was appropriate. Id. at 444-45 n.5. Rather, it held that the prosecution must establish inevitable discovery by a preponderance of the evidence in order for the exception to apply. Id. at 444.
B. Nix's Second Circuit Precursors and Progeny
Nix v. Williams was important in that it signalled acceptance of a widely recognized exception to the exclusionary rule, 467 U.S. at 440 n.2, but the opinion failed to define the precise contours of the inevitability doctrine. United States v. Cherry, 759 F.2d 1196, 1204 (5th Cir. 1985), cert. denied, 479 U.S. 1056, 93 L. Ed. 2d 983, 107 S. Ct. 932 (1987); United States v. Satterfield, 743 F.2d 827, 846 (11th Cir. 1984), cert. denied, 471 U.S. 1117, 86 L. Ed. 2d 262, 105 S. Ct. 2362 (1985). Recognizing the need to refine the meaning of "inevitable," many courts have looked not only to the Supreme Court case but also to consistent precedent from their circuits. See, e.g. United States v. Pimentel, 810 F.2d 366, 369 (2d Cir. 1987); Cherry, 759 F.2d at 1204; Satterfield, 743 F.2d at 846. Six inevitable discovery cases from the Second Circuit -- leading up to United States v. Eng -- help demonstrate the scope and nature of the inevitability doctrine in this circuit. Although none of these cases addresses the analysis appropriate to the particular type of action against Eng, they do illustrate the tenacity of the Nix Court's overriding concern: that in each case, a court must balance the exclusionary rule's deterrence rationale against an equally compelling public interest in having "juries receive all probative evidence of a crime" that was validly and constitutionally obtained. See Nix, 467 U.S. at 443-44; Murray, 487 U.S. at 539-41.
An examination of United States v. Alvarez-Porras, 643 F.2d 54, 59 (2d Cir.), cert. denied, 454 U.S. 839 (1981), a pre-Nix inevitable discovery case from this circuit, is an apt place to begin; although the facts of that case are quite distinct from those before this court, Alvarez-Porras discusses the inevitable discovery doctrine in depth and provides a terse and eloquent summary of relevant precedent from the Second Circuit. Defendants in Alvarez-Porras, convicted of conspiring to import and distribute substantial quantities of cocaine, challenged the seizure of incriminating evidence as unconstitutional because it occurred prior to the magistrate having signed the search warrant, although after the officers had applied for that warrant. Id. at 58-59. Thus, as in many of the later cases discussed below, Alvarez-Porras involved a search at a time when the issuance of a warrant was imminent.
The Second Circuit explained the three related exceptions to the exclusionary rule -- attenuation, independent source, and inevitable discovery -- as follows:
Each of these exceptions rests, most basically, on the lack of a sufficiently close connection between the state's wrongdoing and the invasion of the defendant's privacy. Furthermore, despite the identification of discrete headings for the various exceptions, their applications and rationales overlap enough that we view them more as helpful guides than as rigid tests. In each case, we must weigh the extent of any illegality, the probative value of any legally obtained information, and the relationship between the two, always with the hope of vigorously enforcing the Fourth Amendment without imposing ineffective constraints on criminal investigations.. . . In this complicated area, it is wise to let the cases speak for themselves and to encourage careful analysts and argument rather than to endorse vague headings which add little to our understanding of the problems and which, because of their symbolic impact, may lead inadvertently to a weakening of the Fourth Amendment's protection.