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A decision not to compel the government to choose between giving use immunity to defense witnesses or forgoing its own use of immunized testimony requires consideration whether (1) the government has engaged in discriminatory use of immunity to gain a tactical advantage or, through its own overreaching, has forced the witness to invoke the Fifth Amendment; and (2) the witness' testimony will be material, exculpatory and not cumulative and is not obtainable from any other source. Therefore, a district court must find facts as to the government's acts and motives and then balance factors relating to the defendant's need for the evidence and its centrality, or lack thereof, to the litigation. Factual findings would of course be reviewed under the clear error rule. De novo review of the balancing analysis would not be appropriate because trial courts have a comparative advantage over appellate courts when it comes to weighing the needs of the parties and the centrality of particular pieces of evidence to a trial. Therefore, the United States Court of Appeals for the Second Circuit adopts the abuse of discretion standard to the balancing analysis.
Bernard J. Ebbers was the Chief Executive Officer ("CEO") of WorldCom, Inc., a publicly traded global telecommunications company. During the pertinent times -- from the close of the fourth quarter of the 2000 fiscal year through the first quarter of the 2002 fiscal year -- he engineered a scheme to disguise WorldCom's declining operating performance by falsifying its financial reports. Although the scheme was multi-faceted, the fraud primarily involved the treating of hundreds of millions of dollars of what had always been recorded operating costs as capital expenditures for several fiscal quarters. After a seven week trial, the jury convicted Ebbers on all counts. He was sentenced to 25 years' imprisonment, to be followed by 3 years' supervised release. On appeal, Ebbers principally contended that the district court erred in permitting the government to introduce testimony by immunized witnesses while denying immunity to potential defense witnesses who were rendered unavailable to Ebbers by their invocation of the privilege against self-incrimination. He also claimed that the court should not have given a conscious avoidance instruction and that the government should have been required to allege and prove violations of Generally Accepted Accounting Principles ("GAAP"). Finally, he challenged his sentence as based on an inaccurate calculation of losses to investors, as significantly greater than those imposed on his co-conspirators, and as unreasonable in length.
Did the district court err in permitting the government to introduce testimony by immunized witnesses while denying immunity to potential defense witnesses who were rendered unavailable to Ebbers by their invocation of the Fifth Amendment privilege against self-incrimination?
The court rejected each of Ebbers’ arguments. Adopting an abuse of discretion standard regarding the immunity issues, the court noted that the immunity decisions were consistent with legitimate law enforcement concerns. There was no evidence of overreaching or manipulation of immunity expressly for tactical reasons. Given the policy decisions of Congress on sentences for fraud, the court concluded that Ebbers’ 25-year sentence was harsh but not unreasonable.