The opinion of the court was delivered by: Gershon, District Judge.
This opinion sets forth the basis for my October 13, 2000 order
striking paragraph 2(C) from the proffer agreement entered into between
the defendant Brian Duffy and the government on July 13, 1999.
On July 13, 1999, Duffy and his attorney went to the United States
Attorney's Office in hopes of negotiating a cooperation agreement.*fn1
Ordinarily, the government will not agree to enter into a cooperation
agreement until a defendant makes a factual proffer and describes the
type of assistance he might be able to provide. Before beginning a
proffer session, the doubt. government required Duffy and his lawyer to
execute what is referred to by the government as its "standard proffer
agreement." The government acknowledges that it uses this standard
proffer agreement "during every proffer session with all defendants," and
that it is not negotiable. See Oct. 11, 2000 Tr. at 40.
Paragraph 1 of the government's standard proffer agreement provides
that "[i]n any prosecution brought against [Duffy] by the Office, except
a prosecution for false statements, obstruction of justice, or perjury
with respect to acts committed or statements made at or after the
meeting, the Office will not offer in evidence any statements made by
[Duffy] at the meeting (A) in its case-in-chief or (B) at sentencing."
Paragraph 2 contains several exceptions to the government's promise to
refrain from using Duffy's statements:
Paragraph 3 includes an agreement that the exclusionary provisions of
Fed. R.Crim.P. 11(e)(6) and Fed.R.Evid. 410 "do not apply to any
statements made by [Duffy] at the meeting."
Federal Rule of Criminal Procedure 11(e)(6) and Federal Rule of
Evidence 410 are substantively identical. Rule 410 provides:
against the defendant who made the plea or was a
participant in the plea discussions: . . . (4) any
statement made in the course of plea discussions with
an attorney for the prosecuting authority which do not
result in a plea of guilty. . ."
These rules are subject to two express exceptions. A statement made by a
criminal defendant in the course of plea discussions is "admissible (i)
in any proceeding wherein another statement made in the course of the
same plea or plea discussions has been introduced and the statement ought
in fairness be considered contemporaneously with it, or (ii) in a
criminal proceeding for perjury or false statement if the statement was
made by the defendant under oath, on the record and in the presence of
counsel." Fed.R.Evid. 410. Accord Fed. R.Crim. Pro. 11(e)(6).
Duffy signed the agreement and then proceeded to give the government a
detailed factual proffer. In essence, Duffy admitted the existence of the
securities fraud conspiracy that is charged in the instant indictment; he
explained how the scheme was carried out, and he described how he joined
the conspiracy and the part that he played. Based on the information
volunteered, Duffy's counsel asked the government to enter into a
cooperation agreement with his client and to permit Duffy to plead guilty
to a misdemeanor. The government did not agree, and Duffy proceeded to
Duffy has not challenged any part of the proffer agreement except for
paragraph 2(C), which he moves to strike. That is, Duffy has not
challenged that part of the agreement which allows the government to use
his statements to develop leads or to cross-examine him if he testifies.
Duffy cites as the specific grounds for his motion to strike paragraph 2
(C) that that provision is ambiguous or, in the alternative,
unconscionable. The thrust of his argument, however, is that paragraph 2
(C) operates effectively as a waiver of trial, and that he did not
knowingly and intelligently waive his right to make a defense at trial.
In response, the government argues that paragraph 2(C) does not prevent
Duffy from putting on a defense and states that he will trigger the
waiver only if he or his counsel asserts or elicits any statement that
contradicts the proffer. According to the government, this means that
Duffy's statements become admissible if his counsel were to make a
factual assertion that directly contradicts the proffer either during
opening argument or on summation or if his counsel were to ask a question
of a witness that was designed to and did, in fact, elicit a statement
that contradicts the proffer.
While insisting that paragraph 2(C) does not preclude the possibility
of a defense, the government concedes that Duffy is left with few options
lest he open the door to his proffer statements being used against him.
Duffy can argue that the government has not satisfied its burden of
proof, and he can generally attack the credibility of the government's
witnesses, for example, by challenging their ability to perceive the
relevant events or by questioning them about any criminal history they
might have. The government additionally agreed, when pressed on oral
argument, that a general statement by Duffy's attorney that his client is
innocent will not trigger paragraph 2(C).
In United States v. Mezzanatto, 513 U.S. 196, 115 S.Ct. 797, 130
L.Ed.2d 697 (1995), the Supreme Court upheld a waiver in which a
defendant had agreed that his proffer statements could be used to impeach
his own testimony, i.e., a waiver like the one contained in paragraph 2
(B) of the government's standard proffer agreement. The Court described
Rules 410 and 11(e)(6) as creating a privilege of the defendant and held
that, "like other evidentiary privileges, this one may be waived or
varied at the defendant's request." Id. at 205, 115 S.Ct. 797.
Mezzanatto did not purport to define the outside limits of a permissible
waiver, and, since Mezzanatto was decided, two federal Courts of Appeals
have expressed the view that waivers that permit a defendant's proffer
statements to be used for more than impeachment purposes are
enforceable. See United States v. Krilich, 159 F.3d 1020, 1024-26 (7th
Cir. 1998), cert. denied, 528 U.S. 810, 120 S.Ct. 42, 145 L.Ed.2d 38
(1999); United States v. Burch, 156 F.3d 1315, 1320-22 (D.C.Cir. 1998),
cert. denied, 526 U.S. 1011, 119 S.Ct. 1155, 143 L.Ed.2d 220 (1999).
Whether the Second Circuit and the Supreme Court will reach the same
result as the courts in Krilich and Burch is doubtful. See United States
v. Doe, No. 96 CR 749, 1999 WL 243627, *9 (E.D.N.Y. Apr. 1, 1999)
(enforceability of waiver that extends beyond the use of a defendant's
statements for impeachment purposes "is subject to question"); United
States v. Fronk, 173 F.R.D. 59, n.10 (W.D.N.Y. 1997) ("it certainly is
not clear whether a majority of the Supreme Court would uphold the type
of waiver at issue here, one that is not limited to impeachment
purposes"). While concluding that Mezzanatto's rationale applied equally
to broad waivers of the type involved here, the court in Burch
distinguished the waiver in that case, which was contained in a plea
agreement and executed as a result of successful plea negotiations, and a
waiver, like the one here, which was executed as a condition for such
negotiations. See Burch, 156 F.3d at 1322. In Krilich, the Seventh
Circuit declined to construe the waiver against the government, a
position which, as I will explain, is inconsistent with Second Circuit
law. See Krilich, 159 F.3d at 1025. Finally, it is significant that three
Justices who joined the majority in Mezzanatto wrote a separate
concurring opinion in which they expressed their concern about a waiver
that would permit the government to use a defendant's proffer statements
in its case in chief. See Mezzanatto, 513 U.S. at 211, 115 S.Ct. 797
(Ginsburg, J., concurring).
Unlike the waiver at issue in Mezzanatto, paragraph 2(C) cannot fairly
be viewed merely as the waiver of an evidentiary rule. To the contrary,
paragraph 2(C) implicates Duffy's Sixth Amendment rights to make a
defense and to have the effective assistance of counsel in making that
defense. While paragraph 2(C) does not require Duffy's attorney to sit
silently at trial, it does prevent him from making any sort of
meaningful defense. Practically speaking, all that Duffy's counsel can do
is to argue reasonable doubt. He can assert that the government's
witnesses did not see Duffy doing anything illegal or that those
witnesses simply should not be believed. However, any affirmative theory
of factual innocence, including, for example, any argument that there was
no conspiracy or that Duffy had no part in it, would permit the
government to offer Duffy's proffer.
It is commonplace at trial, the government argues, for lawyers to
refrain from making certain arguments or from posing particular questions
in order to avoid "opening the door" to excluded evidence. Thus,
according to the government, paragraph 2(C) does not impose any
extraordinary constraints on Duffy's counsel. This analogy is not sound.
Even within the narrowly-prescribed areas that the government concedes
are fair game, there are nuances and line drawing problems. For me to
preview each of defense counsel's questions in advance would be
impractical, and, yet, there is no other way for him truly to be certain
of the consequences that a particular line of examination will have. I do
not see how Duffy's attorney can effectively represent him under these
conditions. For these reasons, I find that, under the waiver provision
contained in paragraph 2(C), Duffy effectively forfeited fundamental
aspects of his rights to make a defense at trial and to the effective
assistance of counsel at trial.*fn2
The Court of Appeals in this circuit views contractual waivers with
great care. Even in the context of plea agreements, which include the
safeguard of judicially supervised allocutions, the Second Circuit
scrutinizes waivers closely and construes them narrowly, especially when
they implicate essential rights, for example, as in United States v.
Ready, 82 F.3d 551, 556 (2d Cir. 1996), a defendant's right to an
appeal. See United States v. Padilla, 186 F.3d 136, 140-41 (2d Cir.
1999). As the Second Circuit explained, "In deciding whether to enforce
an individual's waiver of a right, courts ask whether the right
implicates institutional and societal values that transcend the
individual's interests." Ready, 82 F.3d at 555. "[E]ven as to evidentiary
rulings, a defendant may be deemed incapable of waiving a right that has
an overriding impact on public interests." Id. (citing Mezzanatto, 513
U.S. at 204, 115 S.Ct. 797). The Ready court held that plea agreements
should be construed strictly against the government and that "general
fairness principles" could be used to invalidate particular terms. See
id. at 559.
The government attempts to distinguish Ready on the ground that the
bargaining power of the parties and the incentives to provide truthful
information are different when negotiating a proffer agreement as opposed
to a plea agreement. I see no reason not to apply the same principles in
both contexts. Indeed, the case for construing proffer agreements against
the government is even stronger because proffer agreements, unlike plea
agreements, are not subject to any judicial scrutiny before being
effectuated. Although Duffy could have waived his right to trial by
entering a plea, the government's standard proffer agreement effectively
accomplished the same end without affording Duffy the benefit of a plea
agreement and the protections of a Rule 11 allocution.
The Second Circuit recognizes that, when engaging in plea
negotiations, the government has "certain awesome advantages in
bargaining power." Id. These disparities are not diminished merely
because a defendant is executing a proffer agreement rather than a plea
agreement. In fact, the United States Sentencing Guidelines have placed
such a premium on cooperation that defendants are under more pressure
than ever to proffer in the hope that they will be able to provide
"substantial assistance" and secure a more lenient sentence. U.S.S.G.
§ 5K1.1. Even in a case like this one, which does not involve a
statutory mandatory minimum, the power of cooperation to yield a sentence
far lower than that otherwise required by the Guidelines is singular.
Whether or not a defendant gets this extraordinary sentencing benefit
lies largely within the discretion of the government. After all, although
it is the court that ultimately decides whether to downwardly depart
based on a defendant's cooperation, it can do so only on the motion of
the prosecutor. See United States v. Reina, 905 F.2d 638, 641 (2d Cir.
1990); United States v. Rexach, 896 F.2d 710, 713-14 (2d Cir. 1990).
Paragraph 2(C) exploits this power imbalance. After signing the
standard proffer agreement, the terms of which are dictated by the
government, the only thing that a defendant is guaranteed is the chance
to convince the prosecutor to enter a deal. At the same time, the
defendant bears all of the risk.*fn3 The government is under no
obligation to accept the defendant's
offer to cooperate, and it loses nothing by declining. If no agreement is
reached, the government asserts that it is "waiving the right to use any
statements made by the defendant under many circumstances," for example,
during its case in chief. Far from leveling the playing field, however,
this "waiver" simply places the government in the same position that it
would have been in had there been no proffer agreement, because
Fed.R.Crim.P. 11(e)(6) and Fcd.R.Evid. 410 would have required the same
Nor am I persuaded by the government's remaining arguments. The
government's market rationale for paragraph 2(C), borrowed from the
Seventh Circuit's decision in Krilich, is too speculative a basis for
upholding so far reaching a waiver. Krilich predicted that a waiver
provision similar to paragraph 2(C) would encourage plea bargaining by
making a defendant's representations more credible and by strengthening
his hand in negotiations. It is equally plausible that paragraph 2(C)
would discourage plea bargaining by making the price of aborted
negotiations too high for a defendant to bear. See Mezzanatto, 513 U.S.
at 211, 115 S.Ct. 797 (Ginsburg, J., concurring) (expressing the concern
that a waiver permitting the government to use a defendant's proffer
statements in its case in chief "would more severely undermine a
defendant's incentive to negotiate, and thereby inhibit plea
bargaining"). In any event, inferences as to whether the provision
encourages or discourages plea bargaining do not address the more
fundamental issues discussed earlier.
I also reject the government's claim that enforcing paragraph 2(C)
prevents a "fraud on the court." That the Court is aware of facts which
will be unknown to the jury is not significantly different from the
suppression on constitutional grounds of a defendant's statements or
other evidence. Indeed, Rules 11(e)(6) and 410, referred to in
Mezzanatto as creating a privilege of the defendant, specifically
contemplate that statements made by a defendant during plea discussions
will be excluded at trial.
In sum, after considering the realistic consequences of paragraph 2
(C), I find that the waiver in this case implicates exactly the kind of
fundamental interests referred to in Ready. Paragraph 2(C), in effect,
constitutes a waiver of Duffy's rights to make a defense and to the
effective assistance of counsel. To permit the government to extract a
waiver of such important rights as a precondition to engaging in
cooperation negotiations would have "an overriding impact on public
interests" in the fairness of both the plea bargaining process and
federal criminal trials generally. Ready, 82 F.3d at 555. To the extent
that other courts have held otherwise, I respectfully disagree. See
Krilich, 159 F.3d at 1024-26; Burch, 156 F.3d at 1320-322.
For the foregoing reasons, defendant Duffy's motion to strike paragraph
2(C) from his proffer agreement with the government is granted.